Introduction to Mortgage Servicing Examinations Training

Financial Ratios

Liquidity

Current Assets

Key liquidity ratio Higher ratio indicates more liquid. Current Ratio

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Current Liabilities

Current Assets - Inventory

Also called Acid-Test Ratio Short-term liquidity indicator Quick Ratio

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Current Liabilities

Cash

Cash to Total Assets Ratio

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Total Assets

Measures percentage of assets that are highly liquid Helpful when analyzing trends over multiple periods

Cost of Goods Sold

Warehouse Line Turnover Rate

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Average Inventory in a particular period

Measures how many times the warehouse line is drawn and paid off in a month Evaluate whether an institution is maxing out