What are Access National's Business Segments?
Commercial Real Estate Loans-Owner Occupied: This category represents loans supporting
an owner occupied commercial property. Repayment is dependent upon the cash flows
generated by operation of the commercial property. Loans are secured by the subject
property and underwritten to policy standards. Policy standards approved by the
Board of Directors from time to time set forth, among other considerations, loan
to value limits, cash flow coverage ratios, and the general creditworthiness of
the obligors.
Commercial Real Estate Loans-Non-Owner Occupied: This category includes loans
secured by commercial property that is leased to third parties and loans to non-profit
organizations such as churches and schools. Also included in this category are
loans secured by farmland and multifamily properties. Repayment is dependent upon
the cash flows generated from rents or by the non-profit organization. Loans are
secured by the subject property and underwritten to policy standards. Policy standards
approved by the Board of Directors from time to time set forth, among other considerations,
loan to value limits, cash flow coverage ratios, and the general creditworthiness
of the obligors.
Residential Real Estate Loans: This category includes loans secured by first or
second mortgages on one to four family residential properties, generally extended
to existing consumers of other Bank products.
Home Equity Loans are extended to borrowers in our target market. Real estate
equity is the largest component of consumer wealth in our marketplace. Once approved,
this consumer finance tool allows the borrowers to access the equity in their
home or investment property and use the proceeds for virtually any purpose. Home
Equity Loans are most frequently secured by a second lien on residential property.
One to Four Family Residential First Trust Loan, or First Trust Mortgage Loan,
proceeds are used to acquire or refinance the primary financing on owner occupied
and residential investment properties. Junior Trust Loans, or Loans Secured by
Second Trust Loans, are to consumers wherein the proceeds have been used for a
stated consumer purpose. Examples of consumer purposes are education, refinancing
debt, or purchasing consumer goods. The loans are generally extended in a single
disbursement and repaid over a specified period of time.
Loans in the Residential Real Estate portfolio are underwritten to standards within
a traditional consumer framework that is periodically reviewed and updated by
our management and Board of Directors and includes analysis of: repayment source
and capacity, value of the underlying property, credit history, savings pattern,
and stability.
Commercial Loans: These loans are to businesses or individuals within our target
market for business purposes. Typically the loan proceeds are used to support
working capital and the acquisition of fixed assets of an operating business.
These loans are underwritten based upon our assessment of the obligor’s(s’)
ability to generate operating cash flow in the future necessary to repay the loan.
To address the risks associated with the uncertainties of future cash flow, these
loans are generally well secured by assets owned by the business or its principal
shareholders and the principal shareholders are typically required to guarantee
the loan.
Real Estate Construction Loans: Real Estate Construction Loans, also known as
construction and land development loans, these loans generally fall into one of
four circumstances: loans to construct owner occupied commercial buildings, loans
to individuals that are ultimately used to acquire property and construct an owner
occupied residence, loans to builders for the purpose of acquiring property and
constructing homes for sale to consumers, and loans to developers for the purpose
of acquiring land that is developed into finished lots for the ultimate construction
of residential or commercial buildings. Loans of these types are generally secured
by the subject property within limits established by the Board of Directors based
upon an assessment of market conditions and up-dated from time to time. The loans
typically carry recourse to principal borrowers. In addition to the repayment
risk associated with loans to individuals and businesses, loans in this category
carry construction completion risk. To address this additional risk, loans of
this type are subject to additional administrative procedures designed to verify
and ensure progress of the project in accordance with allocated funding, project
specifications, and time frames.
Consumer Loans: Consumer Loans Most loans are well secured with assets other than
real estate, such as marketable securities or automobiles. Very few loans are
unsecured. As a matter of operation, management discourages unsecured lending.
Loans in this category are underwritten to standards within a traditional consumer
framework that is periodically reviewed and updated by our management and Board
of Directors: repayment source and capacity, collateral value, credit history,
savings pattern, and stability.
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