Understanding Loan Management Software
There are many different types of software out there that businesses utilize in order to manage their operations more efficiently. These helpful software platforms make tasks like tracking inventory, storing customer data and managing financials a whole lot easier.
When it comes specifically to lending institutions, however, nothing satisfies their operational needs more than being able to ensure that the loan process is as efficient as possible and that they are catering to the new generation of fast-moving technology users — and this is where loan management software comes in.
In this blog post, we'll take a look at what loan management software is and how it can benefit both lenders and borrowers. We will also highlight some key features of this software that lending institutions should look for in a loan management solution.
What is Loan Management Software?
Loan management software, also referred to as loan servicing software, is a contemporary digital tool that lenders use to manage their loans and keep them organized. It helps them keep track of all the important loan details, including the borrower's information, the amount and length of the loan and the interest rate, and can help lenders make more informed decisions about their loans, in general.
Is loan management software something you're looking for? You don't have to go far, we have one right here at Nortridge. Check out our loan management software today!Schedule a Demo
In the current financial market, credit products are being barraged with high demands. They're being pressured to offer rapid processing of requests, heightened cyber security and with giving lenders and borrowers increased scalability and flexibility. The best loan management software directly solves these challenges. But, how does it work?
How does loan management system software work?
If you're like most lending institutions, you rely heavily on your internal system software to keep your books in order. But if you are new to this arena, then you are probably wondering what you should expect when working with loan management software.
When you first secure software like this, there will typically be a pretty thorough setup process to run through, mostly due to workflow sequences that are going to be the driver of your automations.
Automations can be the entire brains of your operations if you get creative enough. With automation, it can be very complex, however need not worry, Nortridge has your back - Here at Nortridge, we have an entire video library of tutorials and instructions, a User's Guide and a general Knowledge Base, as well as an instant relay to technicians with support tickets, if needed, all available to help with the system setup and beyond. Make sure this vital level of support is included before deciding on any software and lean on your support crew as a lifeline for anything that comes up. Want to get a headstart and see more inside of Nortridge's loan management software? Browse our video resource library!
While it may take some time to get the setup done, it is time well spent — and much time saved in the end. Start there, though; get everything plugged in and then you are ready to rock and roll. While it's complex software, it really is meant to be that simple. In our industry, the essential goal is to make things easier for clients and get them up and going as quickly as possible so that they can start reaping all the wonderful benefits of the software.
Benefits of using a robust loan software
Here are some of the many benefits of integrating into a fully equipped loan servicing software.
Replace manual steps with automation
Instilling this type of software replaces manual steps in the process of loan servicing. You'll spend less unnecessary time on mundane tasks and more energy focusing your attention where it belongs - on building your loan portfolio!
Eliminate inevitable human error
Loan management software offers a reliable and efficient way to service your borrowers' loans. Although it cannot eliminate human error altogether, this software can help to minimize mistakes and ensure that your customers' loans are serviced in an inhumanly accurate and timely manner.
Reduce delays and costs associated with paper processes
No printing or filing necessary, instead you can use the power of the cloud to store all your data and loan history documentation. Take control of your communications and cut costs with an integrated loan software that gives you the power to communicate effectively.
Improve efficiency and profitability
Automated report generation is the modern replacement of the old-fashioned manual intervention of human accountants, sitting at their desktops, inputting numbers into spreadsheets, one after another, hour upon hour. Not only does this take too long in today's fast-paced society, but it costs too much for such low productivity.
Through tracking payments, defaults and errors, and running analytical tools, you can better understand what is happening at any given point in your financials. You'll be able to see where you can save money and where you can invest more. This level of 'keeping an eye on things' prevents dollars from slipping through the cracks and, therefore, eventually raises the ROI.
Not all Loan Management System Software is Created Equal
With a system as granular and all-encompassing as loan software, you want to make sure the one you have at the center of your organization has all the features and functions you'll be needing, and then some. You want to check out the company behind it; that it is dedicated to continually improving the platform and committed to keeping it up to par with the quickly evolving world of technology.
You don't want to have to replace the entire software in just a few years' time due to it not having all the pieces you need or to it becoming obsolete, so make sure the system you go with is fully loaded, or just that it does have everything you will foreseeably be needing.
Features of Only the Best Loan Management Software Platforms
Take a look at the following list of features that an all-inclusive loan management system would have. You want to make sure you have access to all of this so that you are happy with your choice and it carries you many years into the future:
What is loan management software without this function? It's the main purpose of the software itself. This feature should include the ability to send statements, collect payments, maintain records of payments and balances, manage escrow funds, remit funds to note holders and follow up on any delinquencies.
Loan Account Management Systems
Ensuring that you've got the tools to manage your customer's loans quickly is important. What's even more important is ensuring that your customers can be managed without feeling like you're micro-managing each account (thanks automation!)
Improve your practices by constantly monitoring and analyzing collections data. You want to be able to see all of the pertinent information about a delinquent loan or borrower in one screen so you can be equipped with the full picture before communicating with your borrowers.
Reporting and Statements
A good loan management system will allow you to automatically schedule an array of standard and tailored reports, and send out statements in a flash. And not just any old statements, you want print and mail statements. This makes it effortless to send bills, letters, and other documents directly to your customers via presorted mail.
Workflows and Automations
Workflow management for lending institutions is another stellar feature offered by only the top loan software out there. This function automates the front-end and back-end tasks, including restructuring, workout, foreclosure, repo, audit control, and bankruptcy. When these tasks are handled manually, they are time-consuming and prone to human error.
Only the best loan management system software allows you to keep track of your lending activity and stay on top of trends. You'll want access to crucial information, like recent disbursements or outstanding obligations, so that everything runs smoothly from start-to-finish with a minimum amount of fuss!
If the system you choose offers rules, and it should, you'll want to set those up first. Rules are actions that are configured to occur on any and all loans in the system, when certain conditions have been met that are defined within the rule. In layman's terms, it's the way we can automate certain actions once certain conditions have been met.
Payment gateways are often used for collecting money from customers and processing payments. This feature in loan software needs to be flawless, allowing no room for confusion for the party paying, as paying and getting paid is the most crucial part of all of this.
Email and Texting
If email and texting are part of your system, then you'll want to be sure to set these up. This tool is event-driven, no email or text will be sent out unless something occurs to trigger that execution.
Loan Management Software Drives Growth
So, what is loan management software? Well, we hope we have answered that for you, and then some. Because, as a lending institution, choosing the right software is vital. It becomes the central hub of your operations and needs to be robust and work seamlessly the way you need it to.
Our very own Nortridge loan management software is one such powerful and flexible platform that includes all of the benefits and features outlined above and is available today for servicing your loan portfolio. We dive deep with each of our clients and customize their dashboards according to their own unique needs. If you're looking for a way to streamline your business operations and maximize efficiency, contact us today. We want to uncover your needs and see what we can do to help.
If you want to learn more live, why not schedule a demo with one of our experts in loan management software? Ask as many questions as you want, without pressure of purchasing.