Analysis of Self-Employed Borrowers

Instructor-Led Online Course

Click here to see class schedule.

During the recent housing boom, the industry created products that required little or no documentation. On the surface, these products made sense for the self-employed borrower that could not produce extensive amounts of documentation to meet every line item requirement to get a loan. The borrower simply needed to provide enough information to satisfy the lender. Today, we know that some of the reasoning behind no documentation loans was flawed — in part because the product made it easier for people to misrepresent themselves.

The mortgage industry is returning to the origination of full documentation loans, assuming that doing so eliminates or greatly reduces the chance of fraud. However, the desire of consumers to misrepresent themselves to qualify for a larger home loan has not diminished. Accuracy and consistency are critical components of qualifying income, and it has never been more important to perform in-depth analysis of all categories of self employment, including Sole Proprietors, Partnerships, Corporations and S Corporations. That’s why AllRegs Academy is pleased to offer Analysis of Self-Employed Borrowers.

Learning Goals and Objectives

Upon completion of this course, students will be able to:

• Define a Self-Employed Borrower(s)
• Identify the three main factors in analyzing Self-Employed Borrowers
• Identify documents required to determine income for Self-Employed borrowers
• Identify and explain various types of business structures
• Calculate income for a variety of Self-Employed borrower scenarios
• Recognize key factors to consider when calculating Self-Employed borrower income
• Analyze borrower income and determine required tax forms and/or schedules
• Recognize potential red flags when reviewing tax returns
• Evaluate Profit & Loss Statements
• Execute the FNMA Cash Flow Analysis (Form 1084) when calculating income
• Review a Balance Sheet and identify key components
• Evaluate the 1040 Individual Tax Form and identify required schedules when determining income
• Identify critical information found on the 1065 Partnership Tax Form and when it is required
• Evaluate the 1120/1120S Corporate Tax Forms
• Evaluate Tax Schedules A-F
• Identify Tax Return Red Flags

Who Should Attend

• Processors
• Underwriters
• Originators
• QC Auditors

Course Topics

Session 1

• Defining the Self-Employed Borrower
  • Evaluate risks of a self-employed borrower
  • Identify indicators of employment stability
• Business Structure Overview
  • Identify 5 types of business structures
• Analyzing borrower income
  • Business Returns
  • Review of tax forms
  • Review of 1040

Session 2

• Homework review
• Schedules of the 1040
  • Schedule A
  • Form 2106
  • Schedule B
  • Schedule C & Schedule C-EZ
  • Schedule D
  • Schedule E
  • Schedule F
• Schedules of the Business Returns
  • Form 1065
  • Schedule K-1
  • Form 1120S
  • Schedule K-1
  • Form 1120
  • Schedule L
• Red Flags
• Profit & Loss and Balance Sheet

Session 3

• Homework review
• Cash flow analysis
  • Form 1084
  • Adjusted Gross Income (AGI)
  • Schedule Analysis Method (SAM)
• Completing the FNMA Form 1084
  • Line by line review
  • Identify each area of the form and the action required

Session 4

• Homework review
• Review of Sessions 1 - 3
• Review case study as a group

Click here to read the Full Agenda »

Course Delivery

The training sessions utilize WebEx technology in conjunction with audio conferencing. Polling capabilities, live chat, and question & answer sessions allow participants to easily interact with subject matter experts. The course consists of four 90-minute sessions over a 4-week period. Pre-reading and exercises are included and accessed through the AllRegs Academy learning management system. Participants are required to complete assignments prior to each session.

Class Schedule

Choose from the upcoming four-week course sessions:

• Wednesdays, August 7, 14, 21, and 28, 2013, 2:00 pm – 3:30 pm ET
• Wednesdays, November 27, December 4, 11 and 18, 2013, 2:00 pm – 3:30 pm ET

Certification Credit

Upon successful completion of this course, you will earn 6 hours of credit towards the Residential Government Underwriter (RGU) certification.

Tuition & Registration

The course is $365 per person. Tuition includes all course materials. Upon successfully completing the course, students will earn an industry-recognized certificate of completion.

Additional Resources

Printed Literature (PDF)

Cancellation/Refund Policy (PDF)

For more information, call our sales and customer service department at (800) 848-4904 or email sales@allregs.com.