Decisioning Flashcards
(26 cards)
POA
Document that allows a person (principal) to assign another person (agent) to make financial decisions on their behalf
Strong Compensating Factors
- Applicant is Path 1 or 2
- MACU has more than a 5 year relationship with MACU
- Applicant has paid off previous loans with MACU
- Applicant has paid well on MACU loans
- Applicant maintains high share balances
- Applicant has recently paid off collections
- low DTI
- Applicant has good job time
- low LTV on 1 to 2 year collateral
- Applicant has down Payment/ Low LTV
- Applicant has handled higher payment on same loan
- Applicant works for SEG
Co-signer
Should only be added if the member is thin file
Cash Down
One of the strongest factors for reducing risk. Borrowers who inject cash are less likely to default on loan.
Current collections
Rather than deny, consider conditional approval with a condition to pay the collection
Protected Status’s
Can never be a condition
“Need additional household income”
Conditions
- Verify derogatory accounts are paid
- proof of insurance
- pay lenders directly
- need qualified co-signer (household income)
- max LTV %
- max DR %
- explain relationship between primary and co-signer
- cash down %
Counter offers
Must be denied when it goes unfinished
DTI
Debt to Income :
Expressed in percentage form, how much of your gross monthly income is spent on servicing liabilities such as loans, credit cards, mortgage payments, rent,etc.
LTV for Path 6 No FICO
50% max
Cash Out/Title Loan
DTI is high - max LTV 50%
Unsecured debt high - max LTV 50%
Path 6 max DTI
20% DTI based on the amount of income
Path 6 No FICO
Corporate 1 or 2
- Most cases we need a co-signer
- 50% cash down no co-signer
- Collateral should be less than $5,000 with less than 100,000 miles
- LTV 50% (up to 70% with strong compensating factors)
Path 6 with FICO Score
Level 2
- 1st Auto.. same as No FICO Corporate 1 or 2
- 2nd auto 70% LTV 30% down
- compensating factors are collateral, job time, MACU relationship
- short job time (under 1 year), collateral is old or high miles, ask for cash down
- 2 or more years job time and good collateral, 80% LTV and 20% down
How many years for a strong Path 6 credit history?
2-4 years
Waive income on Path 3 Auto
-Loan is less than $30,000 and one of the following:
- MACU balances greater than $15,000
- 10% cash injection
- LTV less than 70%
- new payment is not greater than $100 of old
Waive income Path 1 and 2 Auto
Loan is less than $50,000 and one of the following:
- MACU balances greater than $10k
- 5% cash injection
- LTV less than 75%
- new payment is not more than $100 of previous loan
Waiving income on Path 1 and 2 RV
Loan is less than $75k and one of the following:
- 10% cash injection
- LTV less than 75%
- new payment less than $100 of old
Waiving income on Business, Visa, Signature Path 1 and 2
Unsecured less than $10k and one of the following:
- MACU balance higher than $10k
- requested less than $5000
Waiving income Path 3 Business, Visa, Signature
MACU Unsecured is less than $7.5k and one of the following:
- MACU balance $15k or more
- requested limit less than $5k
Waiving Inspection
- Paths 1 to 3
- Paths 4 to 6 with compensating factors
- cannot waive if Purchase agreement is handwritten
Big Picture
- are there reasons to approve?
- do you think the member will repay?
- What is in the best interest of the membership?
- should we counter offer?
What is OFAC
Office of Foreign Asset Control
A division of the US Treasury that administers and enforces economic and trade sanctions based on countries, organizations, and individuals that sponsor or support terrorist activities or international drug trafficking
When does OFAC apply
When Precise ID automatically determines an OFAC warning.
Submit an OFAC form on knowledge Center. Not available on the weekend.
