Guide · Loan types
Loan boarding for every loan type
Every loan the bank books starts as a package of signed documents and ends as a record on the core. The documents change with the loan type, and the job stays the same: find the terms that vary, check that every document agrees with the others and with the approval, confirm the package is executed, and have a second person approve the record before it posts.
By the Bookend team7 min read
Photo: Kristina Chuprina / PexelsThe job that stays the same
Whether the loan is a construction line for a developer or a used car for a teacher, boarding comes down to the same five steps. The difference is how many documents there are, which terms they carry, and how much volume the desk has to get through.
- 1
Find
Classify every document in the package and locate each variable term with its page and position.
- 2
Compare
Check each term against every other document that states it and against what was approved.
- 3
Verify
Confirm the signatures, initials, dates and notary blocks each document type requires.
- 4
Decide
Put every exception in front of a person to accept, override with a reason, or escalate.
- 5
Approve
Stage the core record with its sources, have a second person approve it, and post it once.
Commercial and industrial, and commercial real estate
The package: Note, business loan agreement, a guaranty for each guarantor, commercial security agreement, mortgage or deed of trust, disbursement request and authorization, notices, errors-and-omissions agreement, the boarding data sheet, and the credit memo or approval.
What gets boarded: Principal, rate with index, margin, floor and ceiling, dates and term, payment schedule and interest method, borrower and guarantors with their CIF records, collateral and lien position, fees, and the product, GL, officer and call report codes.
Where it goes wrong: The note was redrawn at a new rate and the boarding sheet was not. The approval names three guarantors and the package holds two guaranties. Real estate is coded as equipment. Disbursements do not add up to principal net of fees.
Consumer installment and indirect loans
The package: Note or retail installment contract, the Truth in Lending disclosure, the application, the title or lien application for a vehicle, add-on product contracts such as GAP or debt protection, and for indirect loans the dealer funding package.
What gets boarded: Amount financed, note rate and APR, payment amount, first payment date and term, collateral detail such as the VIN, add-on products and whether they are financed, and the dealer and its participation when the bank pays one.
Where it goes wrong: The first payment date moved after the disclosure was printed, so the core calculates a different payment. A financed add-on is on the contract but not on the loan. The VIN on the lien application has a transposed character. The volume is high enough that nobody compares every file.
Residential mortgage and home equity
The package: Note, mortgage or deed of trust with its riders, the Closing Disclosure, the initial escrow account disclosure, the flood determination, and for a HELOC the line agreement and its disclosures.
What gets boarded: Loan amount or credit limit, rate, adjustable-rate index, margin, caps and change dates, principal and interest plus escrow, each escrow item, mortgage insurance, lien position, draw and repayment periods for a line, and investor and servicing codes.
Where it goes wrong: Escrow is set up from an earlier estimate rather than the final Closing Disclosure. The first rate change date or a cap is keyed from the product default instead of the rider. Flood insurance is required by the determination and never set up. A HELOC is boarded with the wrong margin or draw period.
SBA and agricultural loans
The package: The SBA note and the SBA Authorization, which the closing documents have to match, or for agricultural credit the operating line or term loan agreement, a security agreement covering crops, livestock or equipment, and any guarantee documents.
What gets boarded: Guaranteed percentage and guaranty fee, program and call report codes, use of proceeds, maturity, and for agricultural loans the seasonal or annual payment schedule and collateral types.
Where it goes wrong: A closing document departs from the Authorization. The guaranteed portion or program flag is never set on the core. An annual payment schedule is boarded as monthly because that is the product default.
Lines of credit, renewals and modifications
The package: Change in terms agreement, renewal note, modification or extension agreement, and for asset-based lines the borrowing base terms.
What gets boarded: The new rate, maturity, payment or limit, applied to an account that already exists on the core.
Where it goes wrong: A renewal is boarded with the old rate or the old maturity. A change was approved by email and never reached the approval record the keyer checks against. The modification is keyed twice, or not at all.
How volume changes the work
Commercial desks see fewer loans with more documents and more negotiated terms. Consumer and indirect desks see many more loans with fewer documents and terms that are mostly standard. That is why consumer files tend to be sampled rather than compared in full: there are too many of them for anyone to read every one. Software that runs the comparison on every file removes the reason to sample, and it leaves the people on the desk with the exceptions instead of the whole stack.
Mortgage sits between the two. The package is long, the disclosures are regulated, and escrow adds a set of figures that have to be right on the first statement. Bookend boards one loan at a time from its executed package. Bulk servicing transfers and portfolio conversions are a different job, and it is not built for them.
What ships today, and what gets scoped
The Bookend platform started with commercial closing packages, because that is where the variable terms are densest and the documents vary most from bank to bank. Its shipped document set and rule catalog go deepest there.
The engine underneath is the same for every package: classification, extraction with page and position, deterministic rules, execution templates, maker-checker staging, and the evidence chain. A bank teaches its own forms by drawing a box around each value on one example. A new rule that a term must agree across documents, or that a document must be present, is written in one sentence with no code. Document families the catalog does not know yet arrive through a signed release, so every bank gets them and none of them is a custom build.
A Closing Workflow Review works through one of your recent packages for each line of business you care about and tells you plainly which part is configuration today and which part would wait on a release.
The same idea, applied to new accounts
Opening a business deposit or treasury management account produces a package that looks a lot like a loan closing, with the same kinds of errors. The account onboarding guide covers the documents, the common errors, and where your CIP and KYC processes stay.
A checklist to start with
The Loan Boarding Checklist is written from commercial packages and includes the consumer and mortgage items that differ: the disclosure against the note, escrow against the escrow disclosure, and add-on products against the contract.
Questions
Loan types FAQ
Does it work for consumer loans and mortgages, or only commercial loans?
The method is the same for any loan boarded from an executed package: find every variable term with its source, check it against the other documents and the approval, verify execution, and stage the core record for a second person to approve. Commercial packages are where the shipped document set and rule catalog go deepest today. Consumer installment and indirect loans, residential mortgages, HELOCs and SBA loans bring their own documents, such as the Truth in Lending disclosure, the Closing Disclosure, a retail installment contract or the SBA Authorization. A Closing Workflow Review tells you how much of your document set the current release covers and what the engagement would add. Anything the release cannot yet express becomes a product improvement in a signed release, never a custom build.
Who is this for?
Community and regional banks, typically several hundred million to ten billion in assets, that board loans from executed packages (commercial, consumer, mortgage, SBA or agricultural) or open accounts from a package of signed documents, and especially banks on Jack Henry cores. The people who care most are the head of loan operations, the closing manager, the deposit operations manager, the chief credit officer, the COO and internal audit.
Does Bookend replace our LOS, document system or core?
No. LaserPro or counsel still produce the documents, your LOS still originates and approves, your core still books the loan, and your wire room still sends the wire. Bookend sits between the executed package and the core. It validates what was signed against what was approved and stages boarding and funding for your approval.
Can Bookend validate account-opening documents too?
Yes, with the same engine. Opening a business deposit or treasury management account produces a package much like a loan closing: the application, signature card, corporate resolution or certificate of authority, beneficial ownership certification, formation documents and a W-9. The same kinds of checks apply. The legal name and tax ID should agree on every document, every signer on the signature card should be authorized by the resolution, each document should carry its signatures and dates, and the account record should be staged for a second person to approve before the account is opened. Account packages are scoped with you in the Closing Workflow Review, like any document family the shipped catalog does not yet cover.