AVANA Knowledge Challenge

Create an image of a diverse group of professionals discussing commercial real estate, with charts and financial documents in the background, in a modern office setting.

AVANA Knowledge Challenge

Test your knowledge of AVANA's investment strategies, loan processes, and general financial concepts through the AVANA Knowledge Challenge! This quiz is designed for anyone interested in commercial real estate loans and SBA programs.

Explore 27 carefully crafted questions.
Engage with multiple choice, checkboxes, and open-ended formats.
Receive insights into commercial lending and financial benchmarks.

27 Questions7 MinutesCreated by InvestingEagle47

What is the expected average yield on AVANA’s Fixed income fund for loans that have a duration of 90 days to 60 months per annum?

6.50% to 9%

6.75% to 9%

8.50% to 10%

None of the above

What is AVANA’s investment strategy?

To achieve steady income from a diversified investment portfolio of owner occupied commercial real estate debt assets (loans) characterized by a low to moderate level of risk

Loans will be purchased from various financial intermediaries who are experienced commercial real estate lenders who are also specialists in United States Government Guarantee Loan Programs (GGL).

To thoroughly evaluate eligible loans and purchase from SBA’s loan programs (SBA) 504, 7(a), USDA B&I/REAP) loans, development, conventional and bridge opportunities.

All of the above

Once a decision has been made to proceed with a borrower transaction, the AVANA team will engage external counsel and third party service providers to begin preparation of loan documentation. What part of AVANA’s due diligence includes the above process?

Portfolio Servicing

Loan Closing

Loan Origination

Deal Origination

A GGL loan program where the general purpose is for economic development that can be used for a wide range of projects, including renewable energy projects.

Conventional loans

SBA 504

USDA B&I/REAP

SBA 7(a)

For Type B note investments, what are the considerations AVANA must take for the initial investment offering?

AVANA will consider conventional interim real estate debt (loans) for owner-occupied commercial real estate where the businesses have already qualified for a US government loan program but have drawn the maximum benefit from these government loan programs.

Notes are committed to the senior tranche, 1st trust deed which is the most senior debt position in the capital structure are with lien property to the SBA’s funded position.

Participation in the unguaranteed senior tranche, 1st trust deed which is the most senior debt position in the capital structure, pari-passu with the USDA’s guaranteed portion.

All of the above

A nonprofit corporation that promotes economic development within its community through 504 Loans. It is authorized and regulated by the SBA, and work with SBA and participating lenders (typically banks) to provide financing to small businesses.

Government Guaranteed Loans program (GGL)

Certified Development program (CDC)

Department of Agriculture (USDA)

Office of Financial Assistance (OCA)

1. 504 Loans are typically structured with SBA providing 40% of the total project costs, a participating lender covering up to 50% of the total project costs, and the borrower contributing10% of the project costs. Under certain circumstances, a borrower may be required to contribute up to 20% of the total project costs.

True

False

The following are part of the Credit Memo/Credit write up except:

Demand drivers, macro-economic factors and industry overview and market positioning.

Term sheet to prospective borrowers for discussion

Cash flow analysis of historical and proforma financial information

Property collateral summary from appraisal, environmental, property condition assessment and survey.

What is our typical payment date and when is it considered late?

Every 1st of the month and will be considered late after the 10th of the month

Every 15th of the month and will be considered late after the 20th of the month

Every 10th of the month and will be considered late after the 15th of the month

Every 1st of the month and will be considered late after the 15th of the month

Type of costs includes construction building materials that go into constructing the building including Site work, actual construction costs which include the foundation and framing.

Soft Cost

Hard Cost

Project Cost

Contractor Cost

The borrower needs to provide the following during the underwriting process except:

Financial Statements

Income Tax Return

Resumes

Collateral Valuation

How is DSCR calculated?

Net Income plus Interest plus depreciation plus amortization

Divide earnings before interest, depreciation and amortization over the total of the Company’s loan payments for a certain period.

Liquid cash minus the closing costs and equity for the loan.

None of the above.

It is the Net Operating Income of the property divided by the value of the property, typically for hotels, it is 8% to 9%, for offices its 7.5% to 8%.

Debt Yield

EBITDA

Capitalization Rate

Trip Advisor Rating

Loan documents allow us to go back in time and charge a revised interest rate in a rising interest rate environment when servicing forgets to amend the rate?

True

False

In Servicing, what steps would you introduce if the loan payments were NOT on time?

A. Call Borrower to follow up and inquire on the reason for the delay

B. Issue default letter after 30 days of delay

C. Call SBA and inform that loan payment is in default.

A and b

A and c

This is an insurance policy that insures the Lender of the loan amount should the General Contractor fail to deliver and complete the Project.

Borrower’s collateral

Payment/Performance bond

Property Insurance

Security Deed

The amount charged as a percentage of the loan for the use of the lender’s funds. In our loan agreements, this is subject to change from time to time based on changes in an independent index which is generally the Prime Rate as determined by the Federal Reserve and quoted in the Wall Street Journal.

Post Closing Liquidity

Loan to Value

Interest rate

Servicing Fee

Unlock and Upgrade

Remove all limits from your Quizzes

AVANA Knowledge Challenge

AVANA Knowledge Challenge

More Quizzes