What Are Some Operational Challenges for Direct Lenders?
Given the complexities of financial products, it should come as no surprise to learn that direct lenders face a number of unique operational challenges.
Among these many challenges are properly maintaining and managing risk. Direct lenders need to assess the creditworthiness of borrowers and properly manage borrower risk. Lending covenants help lenders minimize this risk, but there are often challenges controlling, auditing, and tracking these covenants.
In a practical sense, and certainly for funds that have more than a handful of loans, lenders need to have the ability to systematically apply, test and manage covenants to their lending portfolio in an automated fashion. In addition to the automation, perhaps the most important challenge of all is having accurate and centralized data for which the covenants will be run. Data management becomes especially difficult when there are several data sources such as individual spreadsheets from multiple departments within a firm. Without accurate data, it’s nearly impossible to have a comprehensive covenant management system.
How Can Sentry Solve Operational Challenges for Direct Lenders?
Fortunately, there are solutions that can help direct lenders better manage the information that is so essential for ensuring their success. Sentry PM is one of the systems which lenders rely on to help manage these challenges. Sentry PM features for Direct Lenders include:
- Centralize and improve the credit selection process by utilizing Sentry’s research management tools
- Create reusable covenants, whether compound, single-factor, or even more complex in nature
- Send real-time notifications whenever a client has either passed, failed, or is coming close to a covenant so that the user can take prompt action
- Administer loan activities such as rolls, splits, combines, and pre-payments for effective and efficient record-keeping that will ensure fair and accurate information
- Generate, track and manage loan notices and automate communication with borrowers to help streamline lending adminstration operations
We encourage interested individuals to contact us to learn more about how Sentry can improve their business.