You use the product category "mortgage loan" to map loans given and loans taken that are secured by a charge over property.

This scenario takes you through the various stages in the loan process for new business, from the initial inquiry through to the legally binding contract and disbursement.

To speed up the entry of the conditions for loans given and avoid errors, you can define one or several condition tables.

Transaction management offers functions for processing new mortgage loans, from the first contact with the interested party, to conclusion of the contract and disbursement. The following process flows apply:

• For mortgage loans given you can use the functions for interested party management to enter basic information about a potential customer without actually creating a contract. This might include the capital required, the purpose of the loan, how the potential customer contacted you and other internal information, such as a reservation period, or a rejection date and reason.
• You enter more concrete loan data in the relevant loan status. In application status you can enter or assign all the data for a potential contract, including general contract data, partner information, collateral objects and other collateral.
• For mortgage loans given, you can also incorporate a decision-making stage in the process flow between the entry of an application and creation of corresponding contract offers. The decision-making function allows you to review mortgage loan applications with respect to the collateral value and the purchase price of the object as well as the credit standing of the borrower, and convert an application into one or more offers or contracts
• In offer status you make changes to the data already entered in application status and enter additional details. At this stage you set down concrete conditions for the mortgage loan. New business tables for loans given help you to simplify and speed up the entry process.
• Once the loan reaches contract status, any missing data must be added. At this stage, all the main loan data must be entered in the system. At this point, you can still enter regulatory reporting data (Germany). A correspondence function is available in the Loans area for generating the contract to be sent to the borrower.
• There are a wide range of options for structuring disbursements, including full or partial disbursements, gross and net procedures and functions for calculating the discount and the commitment interest. You can apply a release procedure to the various stages in the process flow, including the disbursement stage. In other words, you can specify that disbursements must be released before the payment is made.
• Upon disbursement, the accounting information is transferred to Financial Accounting. The accounting side of loan processing is supported by functions for posting interest payments and repayments. For incoming and outgoing payment activities, the Treasury applications use the Financial Accounting functions. The accounting area within Loans Management also includes functions for accrual/deferral of interest and discounts, balance sheet transfers and valuation.
• The position management options for mortgage loans include functions for rolling over loans (individual rollover or mass processing), transferring contracts or entering unscheduled repayments.