Secured Loan Processes in ELA

Secured Loan in ELA

• Loan applications require a valid interest rate based on the year of the collateral, term and borrower's information.
• Applications can be submitted for Auto Approval.
  • This creates a note record with applicant details.
  • Depending on the application's criteria, loans may be auto approved, referred, or denied.

Auto Approval Process

• When the application is submitted for Auto Approval, it will be reviewed by the system and automatically added to the application.
• Based on the review, the loan will be:
  • Approved - A message will indicate this and the loan will be approved.
  • Referred - This occurs when a secondary review is necessary. A note is added to the application, and the loan details are updated.

Reprojecting Loans

• The "Reproject" button recalculates values changed in the loan application.
• Reprojecting doesn't recalculate the risk-based rate.
• If the loan term is changed, the "Risk Based Pricing" button needs to be selected again to update the rate.
• Reprojecting can change the loan status from Approved to Referred.

Tracking Records

• A Tracking Record is essential for Loan Details. It captures:
  • Dealer:
    • Dealership purchase - Tracking code: "1"
  • Member:
    • Private party purchase - Tracking code: "2"
    • Lease Buyout
  • Credit Union:
    • Refinance from another financial institution - Tracking code: "3"
  • In File: This option should not generally be used. Refinance of an ACCU loan warrants a new title file
• The Tracking Record shows the year, make, and model of the vehicle.

Loan Projection

• The Loan Projection screen pre-populates data.
• The loan amount and term are pulled from the application wizard.
• The rate is populated after selecting the "Risk Based Pricing" button.
• The due day and due date are populated based on the application dates.
• The payment frequency is always "04 monthly".
• Members have a choice between paying cash or setting up a scheduled auto transfer.

Loan Amount Calculation

• Include any costs associated with GAP or MRC warranty under this section.
• Use the CUNA link to obtain a quote for warranty products.
• The loan amount will increase with the selected CUNA product.

Calculation Options

• Loan options include:
  • Risk Based Pricing button: This pulls the correct risk rate and discounts based on the ELA parameters.
• The calculation options determine the loan's rate, payment, and auto approval status.

Audit Check List

• Complete the Audit sheet located in the specfile.
• Two audits are required per loan closing:
  • First Audit: Completed by MSR, reviewing Symitar and closing documents for accuracy.
  • Second Audit: Completed by the Branch Manager or assigned individual.

Post-Closing Procedures

• Proof of insurance needs to be faxed to State National.
• Fax number: 877.451.3548

ECOA Code

• ECOA code determines how applications are reported to credit bureaus.
• The ECOA code will be populated based on the original application.
  • If there is one borrower, the code will be individual.
  • If a co-borrower is added, the ECOA code should be changed in the application.
• On a loan with co-signers:
  • The primary borrower is labeled as the "Maker".
  • The co-signer is labeled as "Co-maker".

Application Notes

• Note member relationship with the institution: If new, include referral source or advertising method
• For members with less than two years on job, document the reason for job change
• If multiple applications are submitted by the same member, include details about all applications
• Document proof of income verification: Include scanned documents or direct deposit information. Self-employed individuals require two years of tax returns.
• For signature loans, record the intended use of funds and provide specific details
• If debt consolidation is the purpose, list all debts to be paid and whether they will be closed or kept open
• Explain any late payments appearing on the credit report within the last six months, including the reason for the delay
• For applicants with bankruptcy within the last two years, record the reason for filing
• If a fraud alert is present on the credit report, verify the applicant's identity and document the verification method

This quiz covers the processes involved in securing loans, including the auto-approval mechanism and the reprojecting of loans. You'll learn about how loan applications are evaluated and the significance of recalculating loan values as per changes made. Test your knowledge of these financial procedures and improve your understanding of secured loans.