Create a New Loan – Standard Method

General


Each loan in AutoPal can exist independent of other loans or customers. In some loan servicing software packages, loans and customers are one and the same. In AutoPal, you can create a loan and link an existing customer to that loan. This lets you create a customer once and add them to as many loans as is needed.

Creating a new loan can be done in one of three ways. This article will cover creating a loan via the standard method. This method involves entering basic data for the loan, creating it, and then adding additional loan data. This article will cover this process as well as the basic process leading up to giving a loan to illustrate how to correctly use AutoPal Software.

Collecting Loan Data

When giving a loan, at a minimum, the following information is usually collected:

  • Customer Name
  • Customer Address
  • Customer Phone Number
  • Customer Social Security (USA) or Social Insurance (Canada) Number
  • Current Customer Photo
  • Current Collateral Photo (Only if the loan is secured by collateral)
  • Proof of Residence
  • Proof of Insurance (For collateralized loans if your company requires insurance)

Collecting the basic data makes it possible to prove the identity of the customer and the collateral beyond a reasonable doubt even if the customer claims fraud.

The inception of a loan is usually documented by a contract that outlines the term of the loan. There may also be other paperwork to show a lien on the loan collateral, customer references, credit reports, and other documents.

Initial Loan Creation

To create a loan in AutoPal, navigate to the Loan Manager tab inside of AutoPal.

Loan Manager

Click New Loan.

Loan Creation Type

Now choose Standard Loan Creation

Loan Type

Here you can select the type of loan you want to give. The option you choose will determine what data can be entered for loan collateral or, in the case of Consumer and Other, if the loan is collateralized at all. Your choice will also tell AutoPal which default data and settings to use.

Basic Loan Information

Once you choose your loan type, you will be taken to a screen where you can enter basic collateral information and grouping information for the loan. Here is what the options look like for each of the loan types.

Auto Loan
Auto Loan
Real Estate Loan
Real Estate Loan
Consumer Loan
Consumer Loan
Other Loan
Other Loan

No matter which loan type you chose, you will have the following options:

Pull Settings From Existing Loan

Loan Loan

The Pull Settings From Existing Loan option lets you choose to have the same information in four areas (Source Company, Primary Portfolio, Secondary Portfolio, and Collateral) as a loan that already exists within your company account. To use this feature, enter the loan ID for the loan with settings you want to duplicate into the field provided. Check the boxes to select if you want the loan you are creating to have the same Source Company (Src Company), Primary Portfolio (Pri Portfolio), Secondary Portfolio (Sec Portfolio), or Collateral as the loan you entered. Click Load and the fields on this page will be updated to reflect the data from the other loan.

Loan Numbering

Custom Numbering

You have options to manually set the loan id, or have AutoPal generate one for you. You have some control over the way AutoPal automatically assigns numbers to your loans in Settings > Loan Management > Numbering. The two fields that let you control the ID for this loan are the “Loan ID Option” field and the “Loan ID” field. The “Loan ID Option” drop-down lets you choose whether to use an ID that is generated by AutoPal or to enter your own ID for the loan. The “Loan ID” field is where you enter a custom ID for the loan. You can enter a custom ID and the “Loan ID Option” field will automatically be set to “Enter a custom ID”.

VIN Decode

Decode VIN

If you are creating a new auto loan, you have the option to have AutoPal decode the VIN. Simply enter the VIN into the field provided. When your mouse leaves the field, the VIN will be decoded. You can also click Decode to decode the VIN.

Secured or Unsecured

Secured

If you chose “consumer” or “other” as your loan type, you will have the “Secured Loan” drop-down. This drop-down lets you select whether the loan is secured by collateral. If you select “No, this is an unsecured loan”, the basic collateral fields will be removed fro the setup page.

Basic Collateral Information

Collateral Fields

The basic collateral information will be different depending on the loan type you chose. The following options are available:

  • Auto Loan
    • Year – The model year of the vehicle
    • Make – The company that produced the vehicle
    • Model – The model of the vehicle
    • Trim – The trim package of the vehicle
  • Real Estate Loan
    • Year – The year the property was constructed or land purchased
    • Address – The street address of the property
    • City – City where the property is located
  • Consumer Loan
    • Serial # – Serial number of the consumer product
    • Brand – The company that produced it
    • Model – The model name or number of the product
  • Other Loan
    • Year – Year of the product or service
    • Type – Type of the product or service
    • Style – Style of product or service

Loan Options

You can now designate some of the basics of the type of loan you are creating using three drop-down menus. They are:

  • Loan Type – The main way in which the loan will be used. The options include:
    • Installment – This is the most typical way loans are calculated. Payments come due with a regular frequency.
    • Flooring – This is a loan given to a company to finance the company’s inventory.
    • Credit Limit – This is a loan given where the borrower can borrow up to a certain amount. Note: This is not a true line of credit, because payments will be calculated so the loan will be paid off by a certain date.
  • Calculation Type
    • Simple Interest – Interest accrues daily on the loan and is calculated as Daily Interest Rate x Average Daily Balance for the payment period.
    • Simple Interest (Locked) – The finance charge that is calculated at the beginning of the loan is exactly what the borrower will pay, no more, no less. This won’t be affected if the borrower pays off the loan early, makes late payments, etc.
    • Rule 78 – Interest is calculated using the rule of 78 method.
    • Interest Only – Payments will equal only the interest that accrues in each payment period, with a balloon payment at the end.
    • Lease – Payments are calculated according to the standard lease calculation.
    • Alternate Lease – Payments are calculated according to the standard lease calculation, except that the lease fee is calculated as a percentage of the vehicle value and not the vehicle value + the residual amount.
  • Escrow – This option lets you choose whether to collect an escrow amount with loan payments.

Grouping Options

You can group your loans in a few ways including by source company, primary portfolio, primary sub-portfolio, secondary portfolio, secondary sub-portfolio, and servicing user. Make your selections for each of these options from the drop-downs provided.

Adding a Borrower

Once you have entered all of this information, either click Next Step >> or Create Loan. If you click Next Step >>, you will be able to link a borrower to the loan before it’s created. Otherwise, the loan will be created and you can link the borrower later on.

If you choose to link a borrower to the loan at this time, you will have the option to create a new user by entering all the information for the borrower.

Link a Borrower

If you want to link a borrower that already exists within your company, you can use the Link Existing User screen to search for and link that borrower.

Link Existing Borrower

Once you’ve made your choice about whether to add a borrower, click Create Loan.

Initial Setup

Now you can enter the loan terms and other loan calculation settings in the Initial Setup.

Initial Setup

User Information

If you haven’t already linked a borrower to the loan, go to the user information tab and do that now.

User Information

Although it’s not required that you enter borrower information, it will make the loan much easier to collect on, or, if you decide to sell the note, much more desirable to potential buyers. Once you’ve entered the user information, upload a picture of the borrower. To do this, click the filler image and the click Choose File. To upload the chosen image, click Upload. Now you will have an image of the borrower so you can positively identify him/her.

New Borrower Picture

Payments

Once you have entered the information that will define how the loan will work and specified who the customer will be, you can enter the borrower’s payment data. Loans work the best if you enter one or more payment methods for the borrower in the beginning, and set the borrower’s payments so they will process automatically. This can be done in the Pmt Methods/AutoPay tab inside the loan.

Borrower Payments

In order to process payments through AutoPal, you will need to be set up for either credit/debit card processing services or ACH processing if you are in the US or EFT processing if you are in Canada. You can sign up for credit/debit card processing by filling out the form here for ACH, fill out this form, and for EFT fill out this form.

Click New Debit Card New Bank Account or New EFT (Canada) to enter a new payment method.

Click Schedule New AutoPay to set up the payments on the loan so they will run automatically.

Collateral Information

If the loan is collateralized, go to the Collateral tab and enter additional information about the collateral. This will include any specifics about the collateral that will help you positively identify it, including a picture of the collateral. This information will especially help when referencing the collateral for collections or when selling the loan. Having an image of the collateral can make the loan note more valuable if you choose to sell it.

Collateral Information

To upload a collateral image, click Choose File, once your file is selected, click Upload to upload your chosen file.

Collateral Upload

Once the image has been uploaded, it will appear at the top left of the loan. account.

Document Upload

For the final step, upload any documents that are relevant to the loan including anything that may help with collections. These will be documents like a copy of the signed loan contract, proof of residence, proof of income, proof of insurance, title or deed to the collateral, etc. This will be done in the “Documents tab” inside the loan.

Documents

To upload a document, click New Document.

Upload Document

Now, select a sub section for the document to help you organize the documents better, then click Choose File to choose a file from your computer and then Upload to upload the file.

Upload Document

Your loan is now ready to go!

5 Comments

  1. Aaron

    Is it possible to change the loan ID? I made a mistake and need to edit the loan id for 2 loans.

    1. Andy Morrise

      It is possible. Inside the loan, for which you want ot change the ID, navigate to “Loan Settings”. Click “Manage Loan Settings”. Close to the bottom of the left column, you should see a button labeled “Account Number Options”. Click that and a field labeled “Account Number” will be shown. Enter the new ID and click “Save Changes”.

  2. Laurie Monteleone

    HOW DO I SWITCH THE BORROWER NAME AND INFO TO INDIVIDUAL AND VICE VERSA ONCE THE LOAN IS ACTIVE?

    1. Andy Morrise

      You can’t change a user’s type (i.e. individual, company) once the user has been saved. If you need to change the user fundamentally to an individual from a company, you will need to create the new individual user and then link it to the loan in place of the old user.

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