FOND DU LAC, Wis.–A new white paper has been released to help credit unions with tax monitoring related to commercial properties. Published by Info-Pro Lender Services, the paper notes that that “when it comes to real estate tax monitoring, most often residential loan portfolios are discussed. However, commercial portfolios should also be monitored, for numerous reasons. Real estate tax monitoring of commercial portfolios provides lenders with the opportunity to mitigate risks and prevent delinquencies.”
As the white paper reminds, “It is not uncommon for commercial loans to become delinquent, something that could be prevented if properly tracked and monitored by a third-party vendor.”
Some credit unions and banks have had to deal with “serious problems and repercussions” after allowing some commercial loans to go delinquent, believing they can get caught up in a few months. Instead, the problems often get worse, Info-Pro Lender Services said.
The mistake many lenders make, according to the white paper, is believing the outsourcing of real estate tax monitoring to a third party is too costly, and as a result miss the advantage to be had in security in risk mitigation. The paper urges credit unions to look for third parties that charge reasonable fees and life of the loan options.
“The risks are incredibly high with commercial portfolios, namely because the fees are so high when these accounts become delinquent,” the paper states.
For more info: www.info-pro.com.