Collateralized Loan Documents 2024 PDF

Collateralized Loan Documents Guideline It is critical to review each document for accuracy before loan closing. You are taking responsibility for all documents and verifying they have been reviewed and are correct. The documents that are required must have consistent information that matches our...

Collateralized Loan Documents Guideline It is critical to review each document for accuracy before loan closing. You are taking responsibility for all documents and verifying they have been reviewed and are correct. The documents that are required must have consistent information that matches our member’s account information. Dealer Purchase Agreement o Contract for purchase from dealership listing purchase price and amount to finance. o Owner on Title o Down payment o Taxes & non-taxable o Total amount to finance o Trade-in allowance  ACCU lien has been placed with the dealership and is printed on the Purchase Agreement with the Lien Code ID for Electronic titling.  Verifythe dealership information o Michigan Dealership o Contact information & dealer address  Verifypurchaser information o Only our borrower can be listed on the purchase agreement as buyer.  If our borrower would like a second name on the title, e.g. a spouse, then the spouse would need to be on the loan. o Member’s Address  Must match the information on our application/member’s account.  Verify collateral information o Year, make, model VIN#/Hull/Serial # and mileage o Is there additional collateral?  A boat with a motor and/or trailer.  Verify the amount to finance o The loan amount should match the amount to finance/amount due  Check would be made payable to the dealership  This may be a combination of the loan proceeds and funds from account.  Verify that our lien has been placed with the dealership. It should be printed on the purchase agreement.  Out of State dealership transactions MUST be approved by Lending first.  To consider, Lending will need to know: o What state do they wish to purchase from?  We are limited as to which states we can finance through. o Dealership name must be a franchised dealer, no brokers. o Vehicle/collateral information  Year, make, model, VIN#, mileage o Amount that the member would like to finance. o Is the member going to the dealership to pick up the collateral? o Will the dealership collect sales tax? o Will the dealership submit application for title to DMV?  Would we receive a MI Title with our lien on it?  Would we receive a Title for their state with our lien on it?  We do not allow private party transactions for out-of-state purchases.  If the loan amount requested is small enough, you can suggest a Signature Loan. o After the member transfers the title to a MI Title, in their name, we can consider a secured loan to pay off the signature loan. Sample of a Dealer Purchase Agreement Dealer Invoice with MSRP The MSRP (Manufacturer’s Suggested Retail Price) is used to determine the value for new collateral. Sometime, this is clearly marked on the purchase agreement, however we still need a dealer invoice with the MSRP listed. This will include all the additional accessories and options added to the collateral.  Dealer Invoice with MSRP o For new vehicle purchases o Verify year, make, model & VIN# o MSRP  It is possible to pull in a NADA/JD Power value with the MSRP, this can be used as long as the loan amount is less than or equal to the value pulled by JD Power. o If the loan amount is more, the only way to verify the value is with the dealer invoice. o Update the collateral tracking record with the collateral value after you receive the invoice so that the LTV is within guidelines. Samples of a Dealer Invoice Sample #2 Proof of Insurance We will accept Certificates of Insurance for collateralized loans, only if all the criteria listed below are listed on the Certificate. This applies for Business loans with collateral as well.  Insurance company name.  The borrower (s)/member (s) name as policy holder or insured driver.  The Policy Number.  The effective date effective at the time of closing.  The collateral information is listed on the Certificate and matches our loan collateral information. o Year, make, model, VIN#/Hull#/Serial# The signed Requirement to provide insurance explains what coverage is required by the member to keep on the collateral. It also has the maximum deductibles allowed and our lien holder information. State National tracks the insurance on our collateral and will contact the member if correct coverage is not provided. Examples of Certificates of Insurance: Carfax Report Run Carfax report on all USED vehicles  When submitting a used vehicle application, a Carfax must be reviewed to make sure the vehicle has not been deemed a total loss, stolen, rebuilt or salvaged. We will not lend on these vehicles.  A loan officer will review if an accident has taken place and will note if it is OK to proceed.  Verify the collateral information (Year, Make, Model, and VIN#) matches what is on the application. Review the last reported mileage is in line with the mileage on the application. 10-Day Payoff from other Financial Institution  The 10-Day Payoff letter is for refinancing a loan or paying off a loan with another Financial Institution.  Review the payoff letter for accuracy, making sure the borrower and collateral information match what is on the application.  The payoff amount listed on the letter should match the amount you are making the check payable to the Financial Institution for. o Pay attention to the “Payoff date and good through amount”. If you do not allow enough time for the check to be mailed, the payoff may be short and a Release of Lien will not be sent to ACCU. Appraisal from 3rd party licensed appraiser  The loan officer will request this if required. Scan to the account for underwriting to review. Underwriting will note the application if it meets the requirements. Lease Buyout Package  The lease buyout paperwork should have the name of the borrower or borrower(s) on it. o Only the lessee(s) can refinance to purchase their lease vehicle. o Request a copy of the Vehicle Registration to verify the lessee names on title. o Ask members for any lease documents given to them. The Odometer statement needs to be signed and returned to the Lessor before the leasing company sends us the Title.  The 10-Day payoff amount should match the amount you are making the check payable to the leasing company for. Original Title Beginning 10/1/2023 it will be Mandatory that all titles with liens processed by Secretary of State will be Electronic.  Original Title, not a copy o Required at closing. Except for Lease Buyouts and Refinances with Electronic titles. o Must not be a salvaged or rebuilt Title. o Our Lienholder name and address needs to be stamped on the bottom of title under New Lienholder Information, Secured Party. Note: There may be more than one title (Example: Boat and Trailer). o See Titling procedure Revised 7/31/23