commercial lending and exception tracking

Walk Before You Run: A Practical Guide For Improving Your Loan Document Management Process

Originally published on Callahan and, Wendi Klein, VP of Marketing, shares insights into improving member services through automated lending processes. Read the original article here.

Lending can be incredibly document intensive. Booking one commercial real estate loan, for example, could involve hundreds of pages of credit and loan documents, all of which a credit union must properly collect, store, and index. Expanding your loan portfolio means more paper and electronic documents to manage — and more complexity.

That’s why some credit unions are moving beyond paper loan files, checklists, and spreadsheets by migrating to a centralized imaging and tracking system, such as Alogent’s AccuAccount solution.

Modernizing your loan document system is certainly a smart idea, but doing so requires a long-term perspective and a strategic approach. That’s why Alogent recommends taking a “walk before you run” strategy. Here’s how to get started.

Know Where To Start Your Journey

Too much change at once can lead to burnout for staff and lessen your chances of success with new technology. A better approach begins with an objective assessment of your situation and matches the technology’s capabilities to actual needs.

In the case of document management, financial institutions often focus on those departments that generate large amounts of paper documents. Commercial lending teams might be a good place to start, especially for credit unions that have recently launched or expanded this function.

Key Takeaway: Avoid the temptation to overhaul every department’s processes on day one. Instead, start with a specific team to gain experience, buy-in, and efficiency. Expand from there.

Deploy Features In Phases

Turning your commercial lending or other teams loose in a new platform isn’t a winning strategy. Instead, it’s wise to follow a multi-phase plan to ensure adoption and encourage real change. At Alogent, we typically see financial institutions leverage our software’s capabilities in this order:

1. Document Imaging

Scanning paper documents and electronically storing them in a logical hierarchy offers several immediate benefits. For starters, electronic documents are less likely to get lost or destroyed by natural disasters, and they can be easily backed up for safekeeping. Beyond risk mitigation, document imaging software also empowers more people by enabling them to access the same document at the same time — something that’s practically impossible with paper documents. Audit and exam prep can be considerably faster when information is accessible with a few clicks. Optimizing the management email attachments and documents from your portal, LOS, and eSign products should be considered during this phase, too.

Key Takeaway: Start with document imaging to deliver rapid value and provide team members with product expertise to leverage in the future.

2. Exception Tracking

Effectively tracking, reporting on, and resolving exceptions is essential for mitigating risk and ensuring positive member experiences. Migrating an entire database of exceptions to a new system can seem overwhelming, which is why some financial institutions continue using spreadsheets even after implementing software. It doesn’t have to be that way.

Having already achieved a reliable document imaging process in the previous phase, you’re in an excellent position to begin moving document-related exceptions. Collecting and scanning updated member financials and tax returns might serve as the perfect opportunity. You might need to maintain two reporting systems for the time being, however, that could serve as additional motivation to finalize the migration.

Key Takeaway: Look for opportunities to move your exception data. They’re bound to appear.

3. Workflows

Centralizing your documents and exceptions in one system lays a solid foundation for leveraging a full suite of process automation solutions. For example, with our AccuApproval product, it’s possible to share digitized applications and related collateral documents with underwriting, lenders, and other stakeholders during the approval process. As the loan advances through the life cycle, AccuApproval keeps staff informed with pipeline reports and automated notifications. Past due tasks appear in exception reports, ensuring staff follows up in a timely manner and takes action.

Key Takeaway: Document workflows work better when they’re built on proven imaging and tracking processes.

Let’s Walk Together

Contact Alogent to learn more about AccuAccount, AccuApproval, and our process automation solutions for financial institutions.

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