Repayment Plan Management from Beginning to End

A Fresh Start Repayment Plan is a tool available to overdrawn customers that will allow them to repay the overdrawn balance in up to four payments and will also allow them to retain the use of their checking account. It also may help financial institutions recover and collect on accounts which may have otherwise charged off.

Included with Strunk’s hosted ODP Manager software, financial institutions have access to Strunk’s library of Fresh Start documentation. The library contains a Fresh Start Profile that addresses recommended features and optional considerations, a recommended Fresh Start Policy and Procedure Guidelines, a suggested Assessment template to determine Account holder’s ability to repay the Fresh Start Repayment Plan, and a recommended Fresh Start Agreement. These documents provide the necessary information to start offering and setting up Fresh Start Repayment Plans.

ODP Manager Formal Demand and Final Demand collection letters advise customers overdrawn for more than $100 to ask if a Fresh Start might be an option to repay the overdrawn balance in 4 payments or less. Once a customer contacts the institution, an assessment should be completed to confirm the customer’s ability to repay the Fresh Start Repayment Plan.

If a customer qualifies and accepts the Repayment Plan, ODP Manager users can enter a repayment schedule for each account. The repayment schedule can be used to generate the Fresh Start Agreement to be signed by the customer. It will also create payment reminders to show when a repayment should be due. The payment should be verified in the core system and then tracked in the repayment schedule once paid. If the account defaults on the repayment plan, the Fresh Start Default Letter can be generated in ODP Manager to inform the customer that the account has been closed, charged off, and reported to the appropriate agencies.

ODP Manager offers two reports related to Repayment Plans. The Fresh Start Tracking Report lists all accounts that have been identified as being in repayment by an ODP Status Code. A Repayment Schedules summary report can also be used to track the status of Fresh Starts, including payments made and outstanding balances. Both report options can be exported to PDF or Excel.

If you have any questions about Fresh Start Repayment Plan options in hosted ODP Manager, please contact Strunk Support at support@strunkaccess.com to find out more.

Options to Customize Letter Templates

Strunk’s hosted ODP Manager software includes a suite of standard, recommended, and compliant letter templates. These templates are set up so users can easily generate the letters due each day. Even though Strunk provides the recommended letter content, the ODP Manager software allows the letter appearance to be customized to match other letters sent by an institution.

The letter headers and footers can include logos or text so that letters can be printed on letterhead instead of plain paper.

Letters can be signed by the user that generated the letter or if requested, they can be signed by a specific person, department, or the institution name. If signature images are provided, they can be added so that they show when the letter is generated.

If an institution would prefer to have a letter display a branch contact’s name or the phone number of the branch, the contact information can be updated based on the branch assigned to the individual account. This allows the letters the flexibility to direct users to contact a central location or their local branch to discuss the Overdraft Privilege program.

These options allow financial institutions to feel confident in generating ODP program letters that not only are compliant, but also represent an institution’s desired letter appearance.

If you have any questions about customizing letter templates in hosted ODP Manager, please contact Strunk Support at support@strunkaccess.com to find out more.

Vendor Due Diligence Material Tracked in Strunk’s Vendor Manager Software

Financial institutions regulated by the OCC, FDIC, and Federal Reserve must conduct due diligence on third-party relationships per the Interagency Guidance on Third-Party Relationships: Risk Management. Regulators expect financial institutions to review vendor documents thoroughly rather than just glance over them. Organizing all your vendor management in a secure, web-hosted database is the first place to start in this process. Strunk’s Vendor Manager software simplifies the overwhelming task of monitoring existing vendors and onboarding new ones.

A centralized repository for your due diligence documents ensures that your financial institution has a vendor management program that allows you to engage your vendors at each phase of the vendor lifecycle. This will ensure that all departments and business lines can easily access a unified document from your financial institution while dating it to make sure that it’s the most recent document. This process assists your financial institution in evaluating vendors to ensure they align with operational, financial, and regulatory standards.

Strunk’s Vendor Manager software automates due diligence process by sending alerts to financial institution stakeholders and vendors, saving time and effort. Vendor Manager automates vendor due diligence, providing a practical framework for deciding which vendors to assess in-depth, assessing the risk they present, and monitoring their performance. The Vendor Manager provides proactive risk management and reduces administrative burden. Strunk’s Vendor Manager software can help with your financial institution vendor due diligence to ensure that your organization has a process when entering into a third-party relationship. Click here to learn more.

 

Importance of an Effective Contract Review

The Interagency Guidance of Third Party Risk Management states that an effective third-party risk management life cycle consists of planning, due diligence and third-party selection, contract negotiation, ongoing monitoring, and termination phase.

One of the most critical aspects of the third-party life cycle is the contract negotiation phase. It is essential to evaluate a vendor’s contract with other parties, including sub-contractors, which might transfer or bring additional risk to the financial institution. A vendor contract, sometimes referred to as a vendor agreement, is a legal document that outlines the terms of an exchange of goods or services for payment between the two parties.  Through this agreement both parties understand their responsibilities and obligations during the transaction.

The primary object of a vendor contract is to ensure that all parties involved are aware of what is expected in terms of deliverables, payment, and other relevant details. In the event of non-compliance, the vendor contract also specifies the consequences. Negotiating vendor contracts at the outset of any vendor partnership assists financial institutions in better managing their risks. Vendor contracts usually contain legal provisions, often in a specific order.

Strunk’s Vendor Manager Software allows you to score individual contracts based on the presence and quality of key provisions. Strunk’s vendor contract review enables financial institutions to identify gaps in their contracts and manage the vendor’s risk appropriately.

Flexible Fields in ODP Manager

ODP Manager has a standard list of requested fields that are used in the recommended ODP Manager letter templates and reports. These fields are included in the extract file created by an institution’s core or report writer and are updated when the file is imported daily into ODP Manager.

ODP Manager mappings are customizable and can also allow additional institution-specific data fields to be imported. These fields will be marked as flexible fields and will be labeled with an institution-specific label in ODP Manager. Once the fields have been mapped and imported into the hosted ODP Manager software, letter criteria can be adjusted to use the additional data field values. Report groups can also be updated to use the newly available data fields as well.

This flexibility allows institutions additional opportunities to customize ODP Manager to make ODP Program management in the hosted software more efficient or informative. If you have any questions about adding Flexible Fields in hosted ODP Manager, please contact Strunk Support at support@strunkaccess.com to find out more.

Automatically Archive ODP Manager Reports

The ODP Manager hosted software includes a suite of standard reports that are updated after each daily import. These reports can be viewed in the browser or exported to PDF or Excel. Reports for the most recent seven As of Dates are accessible.

If an institution would like the option to review, analyze, or retain past reports, users are able to export and save the reports as needed. However, if reports are not exported and saved within the most recent seven As of Dates, then the report data is no longer available. ODP Manager offers an alternative to manually saving and retaining reports. Upon request, Strunk can set up a Report Archive which automatically archives the requested reports after each daily import. This will alleviate the need to remember to manually save report copies.

The archived reports are saved as PDF files within the software. For each import As of Date, a folder containing the archived reports is created and can be downloaded. If an institution would rather download the archived reports to save to a network drive instead of accessing though the ODP Manager software, a Download Reports Archive link can be set up instead.

If you have any questions about the Report Archive option in hosted ODP Manager, please contact Strunk Support at support@strunkaccess.com to find out more.

How can Strunk’s software help with your vendor management program?

Regulators take compliance with vendor management regulations seriously due to the critical role third-party vendors play in delivering products and services. Using third-party services can increase the risk of a banking organization, but this does not mean that the organization can neglect its responsibility to perform all activities in a safe and sound manner. It is the responsibility of the organization to ensure compliance with all applicable laws and regulations, including those related to consumer protection and security of customer information. What exactly are the Regulators looking for in a Vendor Management program? Regulators will look for your program to have structure, be consistent, and have accountability. Strunk’s software can be your perfect solution to achieve your objectives. Let’s take a closer look at how it can help you.

The first thing that needs to be accomplished is to have the right structure for your program. The financial institution needs to have a well-documented policy describing how your board and senior management intend to execute vendor management. Strunk’s Policy Manager Software can provide your financial institution with a structured, centralized single source of truth for your organization’s policies. You can also use Policy Manager to document all of your procedures, including links to policies, ownership responsibilities, automated change logging, and multiple file attachments. If your financial institution does not currently have a vendor management documented policy, Strunk can start you off with our recommended standard policy.

Next, the financial institution must establish a consistent framework for implementing the policy that was established. Strunk’s Vendor Manager software can streamline and standardize the entire process. The Vendor Manager software is designed to transform a complicated process into a more organized and self-documenting workflow. It helps to streamline and automate the process, making it more efficient and easier to manage.

The financial institution must be accountable for its vendor management program. Strunk’s Risk Assessor software can assist in identifying what risk your organization must consider with your Vendor Management program, while also mapping what controls and procedures are in place for that risk.

Preparing for your next Vendor Management exam is crucial for your financial institution. Strunk offers several tools that can help you in this regard. While regulators do not expect perfection, they do expect progress and performance. By utilizing Strunk’s software and expertise, you can ensure that you are up-to-date and organized for your upcoming exam. This will make exam time much easier.

Credit Unions: Size Matters When Making Loans

When making auto loans most credit unions look at the term of the loan, the age of the car or truck, and the creditworthiness of the member when determining the rate for the loan. Most institutions look at loan to value, debt to income and/or the credit score of the member before deciding to make or decline the loan request. But, very few credit unions look at the size of the loan when setting rates and all of them are missing out on a huge opportunity.

The three main factors when trying to meet profitability goals from a consumer loan portfolio are: 1) creditworthiness of the borrower; 2) term of the loan and 3) SIZE of the loan. Most financial institutions consider the size of the loan by the age of the vehicle. Many years ago the age was a good substitute for the size of the loan but not anymore.

Small dollar car loans are not nearly as profitable as larger loans when factoring in the costs associated with underwriting and servicing these installment loans. Even if the credit report and term of the loan are equal when evaluating a loan, credit unions should not offer the same rate for a $10,000 loan vs. a $25,000 loan, or a $50,000 loan.

Strunk’s loan pricing solution factors in all drivers of profitability and we will help you set rates based on your credit union’s target return. The tool is very inexpensive, easy to use, and will increase your credit union’s bottom line. In a recent meeting with a 25 year tenured CEO of a credit union she said “I’ve never heard of looking at the size of a loan to determine the rate for a loan. When can we get signed up?”

Contact Strunk 800.728.3116 or at info@strunkaccess.com to learn more about our loan and deposit pricing solution.

Save with Strunk’s Effective Risk Management Tools

Strunk is best known for our fee income improvement programs, including Overdraft Privilege, Rewards Checking and Value Checking. Strunk is also well known for assisting community financial institutions with their risk management and compliance processes using our software.

Strunk offers five comprehensive, easy-to-use, and affordable compliance management tools:

Risk Assessor helps prepare comprehensive risk assessments consistent with regulatory or other requirements, in days, not weeks.

Policy Manager organizes all policy documents into a single database, mapped to the relevant standards and control procedures.

Controls Manager schedules tests of policy compliance and tracks test results.

Vendor Manager is a specialized tool for managing vendor risk that standardizes risk assessment methodology and organizes all vendor related documentation.

Issues Manager is a centralized database for tracking all compliance issues and incidents across your entire organization.

According to Dan Roderick, CEO, “Strunk’s Risk Manager solution brings efficiency to the process and allows our clients to focus on their highest areas of risk. The solution is comprehensive but simple to use, which is something I wish I’d had access to in my days as a banker.”

All our tools are securely and reliably hosted with Amazon AWS, making them available on a variety of devices from anywhere. Risk Manager facilitates remote work and will greatly enhance your internal control and risk management processes and save time – all for one low annual fee.

If you are paying another vendor an annual fee for any one of these tools today, invest just 30 minutes to review our solution suite. We can add valuable services – and may be able to SAVE you money as well! Check out our tools today: https://strunkaccess.com/compliance-software/

Consumers Continue Wanting Access to ODP

Consumers desire Overdraft Privilege as a financial product due to the wide array of choices available to them. In a Morning Consult survey, it was found that 9 out of 10 consumers consider their bank’s overdraft privilege valuable. So, what makes this product so valuable to consumers?

  1. Consumer’s payment will clear instead of being returned, which can be less expensive. Sometimes consumers make mistakes when paying bills and accidentally overdraw their account. Because the consumer has overdraft privilege, the bills are paid instead of returned and it prevents late fees, NSF fees, and re-presentment fees. Overdraft privilege provides relief to consumers by ensuring their bills are paid, even if they miscalculated their bank account balance or forgot about a pending payment that hasn’t cleared yet. This feature significantly reduces their worries and potential financial stress.
  2. Consumers will have funds available if they need them. Although it is generally not advisable, there may be situations where overdrawing your bank account is necessary. For example, let’s say it’s the weekend and the banks are closed, and you have an emergency that requires a visit to the hospital. However, the emergency room won’t provide treatment until you pay a $100 co-payment. Unfortunately, you only have $10 in your checking account. Fortunately, you have overdraft privilege, which means you can make the payment even if it incurs a fee.
  3. Not being embarrassed because of returned payments. When you use overdraft privilege, the recipient of your payment won’t know that your bank account has insufficient funds. Instead, they will see that your payment has been credited as expected.

Despite Congress trying to modify overdraft services, we recognize the importance and necessity for consumers to have access to such programs. Overdraft services provide a significant source of liquidity for many Americans. By having access to overdraft privileges, consumers can be assured that they can make timely payments for their rent or utility bills, thus preventing any late fees, utility shut-offs, or even eviction