Problem Loan ServicesIn most cases, it is neither effective nor efficient for a loan officer or other senior officer of most community banks to engage in problem loan resolution, workout management or special assets. The assigned loan officer is often inexperienced and to some extent compromised by personal relationships with the borrower. This often results in the loan officer being distracted from a more productive role as a producer of profitable banking relationships. Even in banks of sufficient size with the ability to hire a staff of Special Assets Officers, it is more effective and efficient to utilize an outsourcing of the Problem Loan Resolution, Workout Management and Special Assets function for the bank's problem loans. We believe that the knowledge, talents and experience of our staff in these areas will typically far exceed that of the employees the bank is able to attract to these positions. Additionally, the expenses related to internal staffing are fixed and non-controllable; whereas, the expense of outsourcing the Special Assets function is a variable and controllable expense. There are other benefits to outsourcing the resolution of problem loans. Since Crossroads Credit and Portfolio Management LLC is a contractor with no loan authority, there is no role confusion in workout situations avoiding the possibility of lender liability. Also, your loan officers can remain independent of and untainted by the workout process which can lead to a bad reputation in the market. Crossroads Credit and Portfolio Management LLC recognizes there are sensitive concerns for any bank utilizing an outside contractor. We understand your concerns. After all, we are community bankers. Crossroads realizes its actions could impact the image of the Bank in the community. We will take the utmost care in representing your bank in a professional and courteous manner. An overview of the terms and conditions for outsourcing the Problem Loan Resolution, Workout Management and Special Assets function should include the following:
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