Primary Considerations When Automating Loan Docs

What are the primary considerations when automating loan docs, particularly complex loans?

For most lenders, their biggest concern is whether their attorney will stay on board, but outside of this, what are some other primary considerations when turning to automation for loan docs? The benefits that result from automation are pervasive, but you do need to look for the right feature set, especially when it comes to complex loans. The following are top considerations to keep in mind when automating loan docs and choosing a solution provider.

Wide Variety of Built-In Templates

Ensure that automated templates in a software solution address a wide variety of loan structures with custom formats. Some solutions might offer a flimsy alternative, using the same template base repeatedly and just adding on different features.

A truly performant solution, like GoDocs, will have detailed and diverse templates built in. GoDocs provides loans for all commercial collateral types, i.e., retail, industrial, self-storage, hospitality, office, multi-family, manufactured housing, Fannie Mae, 1-4 unit BPL, and raw land. It also provides construction loans (including revolving lines of credit and construction-bridge-term combo loans), C&I loans (including borrowing base facilities), secured or unsecured working capital loans (either lines of credit or revolving lines of credit), fix ‘n flip loans, land lot development loans, etc.

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Click through to view the Commercial Lending White Paper: Synchronizing Doc Gen Automation and the Attorney Relationship. The white paper walks you through the intersection between attorneys and technology.

Market Competitiveness

Commercial lending is fast-moving and constantly fluctuating. An automation solution must be as responsive to shifts in the market as your company is. Look for a solution that captures current market provisions to maintain adaptable and flexible templates that will be market competitive. GoDocs’ legal team always stays ahead on top of market trends, 50-state compliance requirements, and local law procedural matters.

Custom Language

As comprehensive as a quality automation solution can be, on occasion, lenders will encounter a commercial lending deal that requires incredibly unique and specific language. Any automation solution you consider should extend the ability to work with counsel to develop custom language to be included in automated documents and then become a templated customization for future use with ease.

The GoDocs legal team has years of experience working collaboratively with outside counsel to address lender needs, and our process is efficient and expeditious. We do not take months to implement newly developed customization.

Interactive Underwriting Requirements

Another consideration to keep in mind, finding an automation solution that has an established, interactive product development process to address periodic changes in a lender’s underwriting requirements.

Unlike law firms, GoDocs has a disciplined product development team that provides stable, predictable, consistent, and comprehensive document updates/revisions that undergo extensive quality control and well-developed quality assurance processes which are beyond the capabilities of law firms.

Schedule a custom demo to learn more about GoDocs’ digital solution for commercial loans, including Bridge Loans.

Complex Financial Covenants

Software solutions that offer a “one size fits all” template or are limited to one sphere, such as residential, won’t deliver when it comes to your most complex financial covenants. Having the ability to document complex financial covenants, financial reporting requirements, alternative cash management structures, additional collateral options, disbursement controls/protections, and more is essential when it comes to automating loan docs. GoDocs provides a wide variety of these types of documents, borrower covenants/reps and warranties, and ancillary loan documents for both CRE and C&I loans.

Fixed Fee Program

Finally, you want to make sure you have transparency when it comes to fees with any loan doc automation provider. Look for a fixed fee program that provides clear, up front fees that can be included in a lender or borrower budget. Attorneys still resist fixed fees and committed turnaround times, whereas an automated platform can provide both features— something that is increasingly becoming an absolute necessity for borrowers.

Same Standard of Care as Leading Law Firms

The right automation software should provide the same level of care as you would expect from the nation’s leading law firms. There are some companies out there that will offer a “warranty,” but these types of agreements come with a lot of limitations and only amount to a gimmick.

You’ll want to find a solution like GoDocs that operates according to the same standards as law firms, with its product and documents backed by E&O and Cyber Liability Insurance. The expectation from customers and the deliverable from GoDocs is full compliance and no errors across all documents.

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