Efficient Loan Servicing

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Loan Servicing

Loan Management System Software also known as Loan Servicing Software for private lenders starts from the time the loan is disbursed to the borrower until the loan is paid off. Loan servicing includes sending monthly payment statements, collecting monthly payments, maintaining records of payments and balances, collecting and paying taxes and insurance (and managing escrow funds), remitting funds to the funder, credit bureau reporting, interface and sync with accounting system and following up any delinquencies.

Marketplace Lenders have very little choice when it comes to loan servicing software or LMS (Loan Management Software). Most options available are either built on older technology that aren’t designed for today’s online environment or they are built on black box third party components that limits online lender’s ability to create a seamless experience from origination to servicing. LendFoundry’s Loan Servicing Software is built with that in mind, lenders can call up payment history, payment reminder, missed payments, delayed payments etc by calling these micro-services from LendFoundry’s platform.

Loan Servicing
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Our Features

  • Flexible Loan Servicing: Add new payment sources, reschedule payments, re-amortize loans and perform other loan servicing activities.
  • Scalability: Unlimited access to any number of customer service representatives. Scale up your loan servicing operations.
  • Compatibility: Integration with your existing systems now becomes easy. Lendfoundry’s micro-services can easily be embedded into your home-grown systems.
  • Actionable View: A single view of all the important events on any loan at one place, empowering you to take appropriate action on them. Access to information is now hassle-free.
  • Configurations: On pre-payment, do you want to reward or penalize? Lendfoundry has many such off-the-shelf configurations, choose as per your offering!
  • Simplified Credit Bureau Reporting: Send bureau reports from the system in few clicks. Quickly & effortlessly!
  • Robust Verification: Lendfoundry's Verification and Document feature helps instantly verify if your customer is genuinely having a difficulty in repaying the loan, empowering you to tackle such scenarios differently.

Frequently Asked Questions

  • What is Loan Management System?
    • A Loan Management System Software helps in tracking and managing loans. There are a variety of loans provided by a lender be it in product offering viz. consumer loan, commercial loan, mortgage etc and within a product different loans might have different interest rates, payment dates, and more. It is difficult to track all these loans manually or using legacy systems and ensure business is on the right track.

      A cloud based loan management system solves this problem by having multiple products with different parameters configured under one single setup. The system allows us to calculate interests, fees, and more. A loan management solution can also assist you in automatically collecting funds via ACH, wire transfers, credit cards, and mor

  • Why choose Lendfoundry Loan Management software?
    • LendFoundry Loan Management Solution (LMS) helps lenders manage loan servicing digitally while offering scalability, security, speed and enhanced customer experience. Its API based design allows onboarding loans from any Loan Origination System (LOS) and serves as a system of record across multiple loan classes. You can record and track all loans, manage repayment schedules, track scheduled payments and ad-hoc payments, allocate repayments, and keep a check on delinquencies and closures. The system provides flexibility in choosing from multiple accrual methods and payment hierarchies.

      The business rules engine and workflow built into the solution ensures greater regulatory compliance with faster processing time.

      • For your customers, it acts as a self-service portal offering a single view of their loans, payments, statements and facilitates periodic, timely communications.
      • For your support teams, they get everything required at one place and access to dashboards to manage loan portfolios efficiently.
      • For your business, it provides Analytics and AI tools to identify the next best upsell and cross sell opportunities. You can get comprehensive reports or create reports based on interactions with a single individual or business or you can look at how profitable offerings are for you. Reporting allows you to visualize and understand in which direction your business is moving.
  • What is a loan life cycle?
    • The typical loan life cycle in origination is application submission to disbursement.

      For a loan management software, the lifecycle starts from disbursement and ends in payoff. The various function performed by a loan management system software in the loan life cycle are:

      • Loan Onboarding with Loan Account and Borrower Account Creation based on LOS input.
      • Loan Schedule creation based on Principal, Rate, Frequency, Payment Hierarchy and First Payment Date. Support for Moratorium period.
      • For LOC or revolving credit Funded & Non-Funded Limits Management and Multiple Disbursals
      • Document Management
      • Payment Workflow
      • Balance, Overdue, Excess Payment tracking
      • Apply Fees & Charges as per business rules.
      • Account Statements and delinquency management
      • Write off, Charge off, Sell off management
      • Closure Process, Unwinding process (in special scenario)
  • What Types of loans can one manage through software?
    • A lending management software should support multiple products for unsecured consumer and unsecured business lending typically Merchant Cash Advance or Factor based product, term loans, line of credit, portfolio based loans- used for Supply Chain Financing.

      At the loan level the loan software for lenders should be capable of handling different interest accrual methods such as 30/360, Actual/Actual, equated monthly etc with multiple payment hierarchies.

  • What are the features of best Loan Management System?
    • Loan management software, equipped with the latest technologies, prepped with analytics and disruptive tools like AI and machine learning can get more done in a shorter time, with better accuracy than a legacy loan management system to manage in today’s date.

      The features one should look for in the perfect loan management software are:

      • Scalability: The perfect loan management system should allow lenders to not only grow in terms of operations and exceptional service delivery but also allow them to diversify their product offerings. Scalability of the product also helps businesses to start small as per their requirements and once they hit the growth curve a scalable system helps to match the changed expectations.
      • Ease of deployment:  To implement, maintain, and troubleshoot issues arising from an advanced online loan management software that is data critical, 24*7 access to an IT team is a must. The good thing about most cloud-based loan management system service providers is that they not only provide quick implementation but also provide regular maintenance services, including bug-fixes, frequent upgrades, and IT support when needed.
      • Integrated solution: There are multiple facets in the lending business, right from onboarding, credit assessment, loan origination, underwriting, disbursal, and repayment. Having all these modules built into one seamless loan operating system helps lending businesses save time, churn out loan requests, and create an overall pleasant experience for their customers by reducing turnaround time and being more efficient.
      • Centralized access: Loan management software solutions allow lenders to store all customer-related data throughout the customer lifecycle at a centralized location. They do away with the bottleneck of storage and retrieval of borrower data from multiple systems.
      • Credit assessment: The better and more accurate credit assessment, better are the chances that lenders decide on interest rates and loan repayment terms that minimize their risk and maximize revenues. This is only possible when lenders have a holistic view of the creditworthiness of their borrowers including performance of existing loans from the online loan management software.
      • Process Automation: Process automation goes a long way in automating mundane tasks thus reducing turnaround time and boosting operational efficiency.
      • Transparency: All stakeholders, including clients, have a better view and more trust in the lending process.
      • Responsive interface: Providing a mobile-friendly borrower or field staff interface is no longer an add-on feature, but a business-critical feature that you must look for in your loan management software system.
      • Analytics and insights: The best cloud-based loan management systems in the industry provide lenders with gold in the form of actionable data.
      • Seamless yet secure:  Loan management software solutions allow lending organizations to expand and grow by establishing centralized data storage that can be accessed by stakeholders with the right permissions from anywhere in the world.

       

      Read this article to learn more about what you should be looking for when choosing the right loan management software for your business.

  • Why should you use a cloud based loan management software?
    • Automation and cloud computing have brought in a whirlwind of change globally and the financial services industry is no exception.