Former investment banker turned private lender. Join the newsletter for weekly insights about private credit and how I make hard money loans directly to real estate investors.
🏠 The power of in-house loan servicing
Hi Reader, The traditional approach to loan servicing might remind one of an old, creaky machine – functional but antiquated. For years, the industry norm has been to onboard loans to third-party servicers, a process often mired in outdated methodologies and inefficiencies. With the advent of no-code tools and modern software solutions for the private lending industry, in-house loan servicing has become not just feasible but advantageous. As early adopters, we integrated this approach when we launched Longleaf in 2020, and here's why it's transformative: A better customer experienceIn-house servicing means our borrowers enjoy a consistent point of contact. It's personalized, efficient, and ensures we're always attuned to their needs. Borrowers also enjoy this because we are often far more responsive than outsourced servicers. By managing the entire loan lifecycle, from origination to repayment, in-house, we've found it fosters stronger, lasting relationships with borrowers, which can lead to repeat business and referrals. Firsthand feedback & early warningEvery interaction offers us insights. Being at the forefront means we can quickly identify and address potential issues, ensuring we are doing our best to be proactive. For example: when we pull monthly interest by ACH, we know immediately if a payment bounces. We are usually in contact with them that same day. It's an indication there could be other trouble with the project and we don't want to wait to act. Efficiency unmatchedStreamlined operations are more than a buzzword here—they're a reality. With processes directly under our watch, we save on time and costs. We can modify payoff statements, adjust loan terms, and pull payments within minutes. For example: when a loan is funded, we simply change its status and it enters our servicing protocol - there are no potential errors from data re-entry. Embracing technologyWe've leveraged the latest tech to facilitate this shift. Starting with a no-code solution, we're now transitioning to a dedicated SaaS system, bringing origination, servicing, and investor management all under one roof. More on this in the next couple of weeks as we wrap up the project. |
Be the Bank
Former investment banker turned private lender. Join the newsletter for weekly insights about private credit and how I make hard money loans directly to real estate investors.
Hi Reader, The year kicked off with a flurry of activity at Longleaf. Here’s a snapshot of what we’ve been up to, showcasing our growth and some of the fun projects we've been working on. The new landing page Website Redesign Last year, I embarked on a coding journey, leading to our website's recent relaunch. This transformation was strategic, aiming for more than just aesthetic appeal: Upgraded Professionalism: The new design is clean, intuitive, and designed to resonate with a wider...
Hi Reader, Before we jump into today's topic, I'm excited to share the new Be the Bank site. I ventured into coding this year and developed the site from scratch with Ruby/Rails and TailwindUI. It's pretty simple for now, but I have some fun features planned for the upcoming year. For now, you can revisit older editions of the Be the Bank newsletter. Earlier this year, I wrote about why we're funding more new construction projects, highlighting the surge in such ventures we've financed. This...
Hi Reader, Back in 2007, my foray into retirement investing began with the government's Thrift Savings Plan. By the time I left the service in 2011, I had accumulated a modest portfolio of about $20k — not too shabby considering what they paid us. Since then, I've consistently maxed out my retirement contributions, often taking advantage of company matches to boost growth. My strategy? Predominantly growth stocks, capitalizing on my long investment horizon. This approach has served me well...