When a loan becomes past due it enters the delinquency stage of the lending cycle. A loan that remains delinquent for an extended period of time will enter default which makes it difficult to resume a loan agreement and continue repayment. The key to improving performance during the delinquency stage is early intervention strategies that prevent a loan from entering default.
Immediately initiate borrower outreach through multiple channels.
A loan servicer should initiate borrower outreach immediately after a missed payment in order to help prevent default. Communication should occur through multiple channels and it should provide the borrower with a comprehensive set of repayment options that allow them to successfully fulfill their obligations.
Monitor overall portfolio performance.
It is important to continuously monitor overall portfolio performance in order to prevent a rise in delinquencies or defaults. Analyzing loan data across different portfolio metrics will help identify and address areas of improvement, either at the operational or loan program level.
Goal Solutions offers loan servicing with proven default prevention strategies for improved portfolio performance. We initiate borrower outreach at the first sign of delinquency and use a network of specialized vendors to help borrowers stay on track during repayment.