There are certain types of businesses that must routinely offer consumer installment loans to qualified buyers for their purchases. One typical situation is in car sales. A customer walks onto a lot and finds the perfect vehicle. One option is to finance through a bank or an outside source. Another option is to finance through the car dealer. For a lot of customers whose credit may not be the best, this may be their only and best option.
An installment loan is for the dollar amount of the original sale, minus any down payment, for the duration of no more than five years. Installment loans charge a fixed interest rate for the term of the loan, typically at prime rate, plus any additional percentage as set by the loaning company. The loan is paid monthly, and if payments are missed there are clear consequences that are spelled out at the beginning prior to the completed arrangement.
For companies offering consumer loans, they must be able to monitor compliance with the terms of the agreement, which can become a nearly impossible task. To make the job easier, more accurate, and more efficient, companies invest in consumer installment loan software. Meant to track and update accounts, consumer loan software can be customized to meet individual needs.
There are a number of installment loan management software options available. Based on individual needs, a company can choose as simple a program or detailed program to meet their requirements. Installment loan software can do everything from track payments to manage interest rates and late fees. In addition it can help you manage due dates and account information for all of your outstanding loans.
Anytime you offer consumer loans it is wise to invest in software for installment loan servicing. There is an added measure of security and double-check in managing the accounts. With numerous accounts, constant changes, variations in payments and loan structures, and varied rates, installment loan servicing software is the sensible way to go.
Mistakes hurt the reputation of a company, and anytime money is handled it is critical that all information is 100% accurate, 100% of the time. As human error occurs, it is impossible to manage that amount of money and that volume of accounts accurately. The software takes the pressure away, allowing you to focus on sales and collections, continuing the success of the business.