Remedial Account Management

What is not the objective of Remedial Account Management?

• To nurse a substandard or doubtful account back to health

• To regularize credit and document deficiencies

• To strengthen weaknesses of the credit extension

• to locate missing customers and to anticipate debtor’s defenses

• To offer another credit facilities to each borrowers

What are the three requisites for Effective Remedial Management?

• Specific unit to handle problem account

• Strategy Formulation

• Adequate manpower

• Policies, systems and procedure

• Capability Analysis

What are the six different Remedial Measures?

it refers to any change in the principal terms and conditions of the loan in accordance with a restructuring agreement setting forth a new plan of payment on a periodic basis.

• Compromise Settlement

• Loan Restructuring

• Assumption of Mortgage

What is the purpose of Strategy Formulation in Remedial Management?

it refers to covers lump sum payment either through cash payment and generally includes penalty changes

• Loan restructuring

• Compromise Settlement

• Foreclosure

it refers to involves the provision by the borrower of services and/or goods as loan settlement. The good/services shall be used to liquidate the borrower’s obligation.

• Compromise Settlement

• Assumption of Mortgage

• Off-setting/Linkage

it refers to involves the securing of additional collateral to secure the loan and/or continuing Guaranty and/or JSS by a more viable and/or acceptable party as further security of the loan

• Foreclosure

• Loan restructuring

• Strengthen Collateral Credit Position

it refers to involves a third party, e.g. a private individual, partnership, company, etc. wherein he assumes the obligation of the borrower

• Assumption of Mortgage

• Strengthen Collateral Credit Position

• Foreclosure

it refers to procedure by which mortgaged property is sold upon default of a mortgage in satisfaction of mortgage debt

• Strengthen Collateral Credit Position

• Foreclosure

• Loan restructuring