100% Committed to Bank and Credit Union Collection and Recovery

Mitigating FHLB Lending Risk Through Collections

Cash loan credit risk can be mitigated by all Federal Home Loan lenders at financial institutions. 

Lender involvement in the process involves a number of requirements and complicated steps, however.  

Loan departments within each bank must access and gather borrowers’ income information based on financial regulatory and other debt details including examination reports.

Modern bank debt collection software simplifies the process and ensures consistent service compliance.

Loans by Federal Home Loan Banks – A Brief History

The form and framework of Federal Home Loan Banks (FHLBanks) was brought to life by the Federal Home Loan Bank Act of 1932.  In response to the depressed economic situation, FHLBanks focused primarily on raising the amount of loan funds available to satisfy expenses of affordable home and community projects.

The amount of loan funds available to satisfy the expenses of affordable home and community projects were what FHLBanks focused primarily on raising, in response to the depressed economic situation. 

Lender FHLBanks offer loans, called advances, to their bank industry members.  

Money from these regional lenders is used to fund supply funds to all sizes and types of financial institutions. 

Credit unions, community and commercial bank member customers, insurance firms, and more are eligible. Financial institutions from every state cooperatively own the network of eleven supportive FHLBanks.

In a great number of cases, the FHLB loans solution continues to considerably impact housing and development financing.  Cash funds payment is offered to member institutions at no fee and rates that are typically lower than commercially competitive prices. Credit check collateral such as borrowers’ mortgage account information is used to secure these payments.

Loans approval for loan applications securing low APR payday loans and other case needs can help many lower credit score borrowers to pay expenses and improve life in their home and community.

Powerful CARM-Pro™ debt collection software helps banks limit
credit risk, enhance profitability and ensure debt collection compliance.

Cash loan service access is one of the best ways U.S. lenders can consistently support people and community needs for paycheck jobs and economic growth. Low bank application fees and favorable terms support the needs of customers and their communities.

Credit process exposure can be managed by each FHL bank through reviewing borrowers’ financial situations in an integrated approach that balances customers’ needs with conservative lending policies and processes.

Loan Amount Advances Offer a Variety of Options and Terms

Loan amount advances are the largest category of assets of FHLBanks on a combined basis. Advances are secured by mortgage accounts and held in checking account portfolios and other eligible collateral pledged by borrowers.

Bank cash services such as loans can serve as a funding source for a variety of mortgage types. They support underserved and diverse housing markets, including those ranging from very low to moderate income households.  FHLB lending offers a wide range of fixed and variable interest rate advances with different rates of interest, payment characteristics, options and maturities.  From one day to 30 years, a variety of terms are available.

For those borrowers that choose to sell or convert their mortgage loan amount into securities, FHLBank funds can provide interim cash money. Each unique banking institution develops loans program to meet the particular needs of its borrowers, consistent with safe and sound bank operation.

CARM-Pro™ Debt Collection Software Maintains Collector Productivity and Compliance

Federal Home Loan reporting requirements state more than 60 decision data items must be captured. This amount of data is difficult for debt collection professionals to manage in a traditional spreadsheet. 

Robust debt collection software such as CARM-Pro™ enables banking professionals to increase their productivity, manage accounts, and maintain compliance by organizing data into easy-to-read reports.

How BankLenders Minimize Loan Risk

Throughout the life andterm of a money advance, a lender can limit cases of risk and loss by:

Collateral arrangements vary with borrower credit quality / credit score, borrowing capacity, and collateral availability, as well as the bank’s overall credit exposure.  The bank will determine the amount it will lend against each collateral type, with a decision regarding each customer’s borrowing capacity.

CARM-Pro™ Collection and Recovery Manager – Professional by Intelligent Banking Solutions helps each FHLBank to manage its process and evaluate its member and non-member borrowers, based on financial, regulatory and other qualitative information, including examination reports.