Blog

Offering insight into the latest trends, regulatory issues and member business lending best practices.

Copy This Commercial Loan Tactic………..

Diana KnightThis recent (well done) LinkedIn article by Chris Nichols reminded me of the power and usefulness of the loan modification strategy in retaining valuable loan relationships. While most of us may associate loan modifications with Trouble Debt Restructuring (TDR) they are also used widely as a defensive mechanism to retain desirable credits. A loan modification is simply a 1- 3 page document executed by the borrower that modifies specific terms of the original note and or mortgage.

The basis of the argument is that it is much more cost effective to retain existing credits (even with renegotiated rates) than it is to acquire new commercial members. We know many of you have experienced pressure on your portfolios as banks ramp up production post-recession.  The pro-active retention strategy outlined in the article will reduce portfolio runoff and solidify relationships with existing members.

 

 

 

 

 

 

 

 

Chris Nichols/Community Bank Data

One of the many services provided by our Doc Prep team is the preparation of modification documents for any MBS prepared loan doc set for a nominal charge ($250 or less). Turnaround is usually 1-2 days.

Feel free to give Jim or I a call to discuss this or any other MBS service.

About the Author

Diana KnightDiana Knight’s responsibilities include ensuring prompt and accurate delivery of business loan documents to the member credit unions, while also providing technical support to the member credit unions in the area of loan operations as it relates to business lending. Diana has extensive experience in banking and real estate with community and regional banks. In her 9 year tenure at MBS She has worked in all departments and is well respected by teammates and clients.View all posts by Diana Knight →