If your business is struggling with loan servicing, you are not alone. Successfully managing consumer loans is easier said than done; it’s a multifaceted task that, if done incorrectly, may result in financial hardship or legal trouble.
Loan servicing is a demanding but essential part of your business. Thankfully, you don’t have to devote precious time and resources to internally handling consumer loan servicing. Instead, you can outsource the task to a third party specialist. Read on to learn more about the benefits of partnering with a loan servicing company.
Reduce Compliance Risk
Like everything else in the world of finance, portfolio servicing is riddled with regulations and pitfalls you need to avoid. One wrong step and your business could end up in hot water, often resulting in a hefty fine and a loss of reputation.
Specifically, the Consumer Financial Protection Bureau (CFPB) and state level Attorney Generals are responsible for ensuring the fair treatment of consumers by banks, lenders, alternative lenders, and other financial institutions. While nobody purposely tries to harm their borrowers, many businesses accidentally cross a line in the sand and pay dearly for it.
To avoid legal trouble, industry leaders in the consumer loan servicing space have dedicated compliance officers whose full-time job is to ensure their clients are shielded from legal trouble. Maintaining timely and accurate state licensing renewals, conducting compliance audits, and creating protocols for the organization are just a few tasks that a compliance officer does. With the help of an industry specialist like PCG, you get the benefit of seasoned compliance advice without hiring in-house.
Increase Collection Rates
Another benefit of partnering with an industry professional is the boost in collection rates. No matter how good your underwriting is, you are bound to have some borrowers who neglect their loan payments. When that happens, your cash flows suffer, and your bottom line takes a hit.
However, there are proven systems and strategies that industry specialists can deploy to maximize your collection rates. With the right partner, you can expect higher collection rates to maximize your cash flows.
Data, Analytics, and Reporting
The final benefit of partnering with a loan servicing professional is the robust data, analytics, and reporting they bring to your company and investors. Often, companies and decision-makers lack the insight to make fully-informed decisions about their loan portfolio. If areas of the portfolio are overexposed or excessively risky, businesses may not know until it is too late.
However, loan servicing companies with a robust technology stack can collect data and create insightful reports on demand. Whether originators, investors, or debt providers want to confirm that their assets are safely generating a profitable return, the right loan servicing company can provide those utilities on demand.
Finding a Consumer Loan Servicing Partner
While the benefits of a consumer loan servicing partner are undeniable, finding the right business to trust with your accounts is a big decision. With the wrong company by your side, you could waste time and money and risk a compliance violation.
Thankfully, Paramount Capital Group is here to make that search easy. We pride ourselves on our customized solutions that have a track record of creating unique niche servicing, subservicing and backup solutions. As a business partner, you are an integral part of our design and development process. Along every step, we craft our portfolio servicing solutions to accommodate your unique receivables.
We strive to provide the highest level of service to both you and your customers at every point of contact. With PCG behind you, you can expect all of the benefits discussed above and much more.
If you want to learn more about what Paramount can do for you or if you are ready to have Paramount support your business, click here to get in touch with a loan servicing specialist!