Writing Effective Credit Memos and Loan Narratives Webinar
The purpose of this course is to teach skills required to write an effective credit memorandum, which places emphasis upon factors or trends that are important without the need to state the obvious. In short, the credit memo should present relevant, material facts and the writers’ thoughts and opinions. Remember, anything you write in a credit memorandum will become public record if you find yourself in court with a borrower.
After a detailed credit analysis of a loan request has been performed, it is now time to communicate your findings in writing. Credit memoranda are a primary means of communications within the banking industry. Without a proper understanding of how to effectively write a credit memorandum is the difference between conducting a successful lending process to the consumer.
Why Should you Attend:
In writing effective credit memoranda, it is not what you say that commands attention, but how you say it. Learn the three functions of credit memoranda: 1) They provide information on the condition and status of a customer relationship; 2) They provide a record of thoughts and actions and 3) They support or recommend action.
The webinar will also explore the underwriting and reporting on Commercial Real Estate, Construction Loans, Acquisition and Development Loans and Multi-Family Unit loans. In doing so, several samples of proven credit memos will be examined to insure bankers are covering the areas required by the banking regulators.
Essence of Credit
- Purpose and basis of the credit
- Primary and secondary source of repay
- Written repayment program
- Collateral valuations
Conformity to credit policy
The five C’s of credit
Strengths and weaknesses
Justification for exceptions to underwriting
- Makes recommendation
Primary means of communication within banking industry
- Serves three functions:
Supports or recommends action
Provides information on the condition and status of a customer relationship
- Provides a record of thoughts and actions relative to a customer relationship
- Memos are to be succinct and to the point, but we violate this idea
- Readers of credit memos are skilled bankers. Therefore, it is not necessary to state the obvious
- Memos should present relevant material facts and writers thoughts and opinions
- The written opinions should be supported by facts
- Anything you write in a memo will become public record if you end up in court with a customer
Objectives of the Presentation:
At the end of this course, the participant will be able to: