There are only a few occasions in a person’s life, when they opt for a loan. Either they are purchasing a property, buying a vehicle or going for education. People take these loans at different points of time in their lives. And it is the responsibility of a loan management company to ensure that its customers are receiving the best of its services. There are a lot of challenges faced by the company while lending as well. When they use paperwork rather than an integrated application, crucial data tend to get lost or misplaced. The company is not able to track important documents and the performance of its employees are not measured accurately. That is why you should have the best loan management software to manage your end-to-end services. If you are wondering how loan management software can improve the overall lending experience, read along.
Challenges faced during the lending process:
The major challenges faced by this industry are related to paperwork. It can make or break any application in line for loan approval. Documents often go missing, causing a lot of trouble to both the applicant and the company. Physical files and documents can be easily tampered and made use to one’s advantage. This affects the reputation of a company in the market and leads to the loss of potential customers. Also, when things are done manually, it takes more time and manpower to complete even the simplest tasks.
How loan management software can help:
Using loan management software can help you in several ways. Let’s look at some of the changes that it can bring to your overall process.
Lenders tend to track their leads and sales activities on paper or in spreadsheets which is extremely difficult to refer for the future reference. Loan management software provides a centralized system for the lenders to write, store, edit and manage information as a database in the system which helps in tracking progress and analyzing the data for future.
A loan when processed from the application stage to closing involves several bank employees, business development officers, credit committee, financial analysts, risk analysts and closing agents. It is impossible to manage their data accurately if you are still using pen and paper. To achieve visibility in the system, it is a necessity to use loan management software. Visibility helps the management to see the status of a loan application and improve pipeline management.
When a document is lost or misplaced, can you imagine yourself searching for that one particular document among the lot of thousands? That is why it is recommended to use loan management software. It becomes easier to track a lost document with the help of a software solution. A centralized system helps trace all points to search for critical documents easily.
Collecting Customer Information
Loan reviewing is done by every financial institution to identify customers with potential credit risks. For this, updated financial information can collected easily and efficiently with a loan management software. The software can streamline data and track activities to find out the financial record of an applicant and check their eligibility for the loan.
Features of loan management software ease out the various processes of lending:
Features like billing, payoff and accounting come under reporting features. You can also get customized reports like payments summaries, late accounts, and billing reports.
Flexible loan servicing support
Loan management software enables allocation of multiple borrowers and guarantors to a single loan. It helps in setting up a multi-user network that has up to three levels of security.
Interest calculations option
Loan management software includes self-amortized and interest-only loans. Interest calculations are based on Actual/365, Actual/360 and 30/365, 30/360. It also supports adjustable rate loans.
With the help of a lending software, you can track investor certificates, investor allocations, and the amount of capital invested. Investor participation reports can also be exported into Excel.
Various loan management software applications provide bank integration. Bank integration can prove advantageous for an efficient lending process. It can make the whole process easier and faster.
There is no need for accounting software or cash flow reports. With the help of integrated accounting, all of this can be done easily. Loan management system can streamline all your business transactions.
Document management system
You can store, organize, search and retrieve documents with loan management system. You no longer have to keep separate files for each and every potential loan customer.
Access to information is available based of the roles and responsibilities of an individual. You can grant or deny permission to anybody who is trying to access confidential data. This gives a greater control to your data and provides security.
Helps in auditing
Each and every transaction can be traced back to where it started and whether it is approved or not. This can improve accountability and responsibility in your business.
Credit risk assessment
Several loan management systems provide credit risk assessment which helps in preventing fraudulent activities. The software collects and analyses the potential borrower’s data and implements credit decisions itself.
These are the various features which would help your business and improve the overall money lending experience. You can try these loan manage software applications if you are looking forward to make your lending processes hassle free.