Documents & Forms:

What are the key documents initially required for a term sheet proposal?

Pre-qualification Documents:

• AdvisorLoans Application
• Last 3 Years Tax Returns
• Personal Financial Statement
• Practice Performance Statement (AUM and revenue report)

What is the 4506-T form?

Most lenders require verification of the buyer & seller tax returns through the IRS. The 4506-T form allows a lender to pull transcripts of the filed tax returns directly from the IRS.

What are the key qualification documents the lender will need from the seller?

For complete asset acquisitions:

• Last 3 years tax returns
• YTD financials
• Practice Statement showing AUM and revenue

For partial client acquisitions (purchasing less than 50% of GDC/revenue):

• Practice Statement showing AUM and revenue
• Client list being sold showing each client’s AUM, recurring revenue, commissions, state, age, and length of time as a client. Client names are not included for underwriting but would be included in the exhibit of the purchase agreement.

How does AdvisorLoans securely manage documents?

We utilize LoanBox which is a secure document management system used by many fiffeernt banks across the country.

What are lenders looking for with a pro forma projection?

This is one of the more important items for acquisition underwriting. Projections are for the first 2 years of the combined businesses post acquisition. The bank wants to see that after combined revenues, and expenses, there is enough cash flow to make the loan payment and have room left over to meet their minimum DSCR ratio.