Introduction
Configuring additional product types allows lenders to expand their loan offerings, including Construction Loans, Fix & Flip Loans, and Commercial Loans. By adjusting standby interest settings, you can control how investors contribute funds, either by funding the entire loan upfront or only specific draws. Properly configuring these options optimizes underwriting, cash flow management, and risk reduction.
Navigating to This Section
1. Click the Gear icon in the top-right corner to open Settings.
2. Select Company Settings.
3. Use the left-hand navigation menu to find and expand Loan Setup/Origination.
4. Locate Additional Product Types.
Tip: If you cannot access Additional Product Types, ensure you have the necessary permissions or check with your administrator.
Available Loan Products
Lenders can enable different loan types to accommodate various financing needs. These options affect how funds are managed and how interest is charged.
Product Type | Description |
Construction Loans | Supports staged funding for construction projects. |
Fix & Flip Loans | Provides short-term financing for property renovations and resales. |
Commercial Loans | Enables financing for commercial real estate transactions. |
Interest Calculation Options
When configuring loan products, you can select how interest is charged:
Setting | Description |
Charge Interest on Total Facility | Interest is calculated on the full approved loan amount, regardless of draws. |
Charge Interest on Total Loan | Interest is charged only on the amount drawn by the borrower. |
Best Practice: Enable only the loan types necessary for your business to streamline workflows and reduce complexity in loan management. Selecting the right interest calculation method ensures alignment with investor and borrower expectations.
Investor Standby Interest Settings
Investor Contribution Options
Determine how investors fund loan facilities:
Setting | Description |
Total Facility Upfront | All investor funds are allocated at loan inception. |
Advances/Draws Only | Investor funds are allocated per draw/advance. |
Loan-by-Loan Basis | Standby interest rules are decided individually per loan. |
Note: Selecting the correct funding approach helps balance liquidity and risk for investors.
Standby Interest Allocation (Total Facility Upfront)
Setting | Description |
Allocated to Admin Company | Standby interest is assigned to the administration company. |
Proportionate to Initial Advance | Standby funds mirror the first advance amount. |
None | No automatic standby interest rules apply. |
Standby Interest Allocation (Advances/Draws Only)
Setting | Description |
Based on Total Outstanding Facility | Standby interest applies to the entire outstanding balance. |
Based on Investor’s Contribution | Standby interest is calculated per investor’s committed funds. |
Loan-by-Loan Basis | Underwriting decides interest rules per loan. |
Allocated to Admin Company | All standby interest is directed to the administration company. |
FAQs
What is standby interest?
Standby interest refers to the interest allocated to investors or the administration company based on their funding structure.
Can I change loan product settings later?
Yes, product types and standby interest configurations can be updated at any time.
How do I decide between total facility funding and per-draw funding?
Total facility funding offers stability, while per-draw funding allows for better liquidity management. Choose based on investor preferences and business needs.
Need Further Assistance?
For additional support, contact us:
📧 Email: support@mortgageautomator.com
💬 Live Chat: Click the question icon at the top-right corner of your screen.