Pooled Assets with Securitization
A solution for optimizing capital and lowering credit risk
There's an option that has been gaining more attention recently: Securitization
Securitization: An Innovative Approach to Financing Your Loan Operations
Access Quick Capital
Explore GOLDPoint Systems' solutions to finance your consumer and retail lending operations.
As securing funds from banks become more challenging, finance companies are exploring alternative options to expand their operations without compromising their business activities.
- Funds have become more difficult to secure
- Banks are reducing access to funds
- Institutions are seeking to optimize capital & lower risk
- Finance companies are looking for options to expand without sacrificing operations
Securitization: Assets Pooled and Repackaged Into Interest-Bearing Securities
Is Your Financial Partner Constraining Your Growth?
How Lowering Credit Risk Benefits You
The securities involved in a securitization are split into tranches where the assets share similar qualities with one another (interest rate, loan classification, etc.). Different tranches can carry different risks and exposure within a portfolio.
Several benefits are available for an investor to participate in securitization, here are a couple:
- Higher Rate of Return – Better chance of having a higher rate of return on revenue-generating assets.
- Portfolio Diversity – Allows investors to diversify their portfolios and gain access to high-quality assets that they normally could not invest in.
Securitization with GOLDPoint Systems
Securitization and Pooling of Assets
Lower Capital Requirements
Some legal or regulatory requirements might require entities to limit the amount of capital. Securitization moves those assets “off-balance-sheet”.
Liquidity
Assets that likely would have taken years to generate cash flow can now be quickly done as a lump sum. This frees up capital and generates a new financing source instead of borrowing from standard financial institutions.
Increased Credit Rating
Removing receivables off the balance sheet may help raise the institution’s credit rating, allowing it to borrow funds at a lower rate. In essence, the institution is transferring the potential default risk to the investors.
Fee Income
By moving accounts off the balance sheet, interest income is now being replaced as fee income when servicing those loans for the investors.
Securitization Capabilities within the Loan Origination and Loan Servicing Systems
Worried About Your Line of Credit Being Called?
Relying on a lone source of capital can jeopardize your operations. Explore how GOLDPoint Systems' securitization tools can offer diverse financing solutions to ensure the continuity of your lending business.
- Bulk Update – Quickly securitize a new pool or top off an existing pool of loans in seconds using our bulk update utility.
- Reporting – Securitization reports and borrowing base certificates can be tailored to meet your investors' specific requirements and scheduled to run daily, offering comprehensive tracking of pool activity and up-to-date status on each investor portfolio.
- Document Vaulting – Ensure the security of original electronic documents by restricting access exclusively to the loan owner.
- Electronic Loan Portal – Provide your investors with view-only access to their securitized loans through a secure web portal. This access includes detailed loan information, transactional history, and electronic documents.
- Loan Renewals – Loans can be automatically refinanced into an existing investor pool at the time of origination.
- General Ledger Tracking – Detailed loan transactional data can be posted into separate General Ledger accounts according to the investor pool.
Want to Ask Robert More About Securitization?
Schedule a free demo and find out for yourself.