Loan Life Cycle
Loan Transaction Lifecycle
After a loan account is created, it undergoes through three major stages to complete its lifecycle. Each stage has its processes and actions that can be executed within it.
The three main stages include:
After a loan is created, it enters a "pending" status. During this time, the loan application is evaluated by a loan officer or another authorized user within your organization who has the necessary role and permission to approve the loan.
Pending Approval
Once a loan is created, it is set to "Pending" status. The loan application under this stage is awaiting evaluation by the loan officer or any other user within your organization who has the necessary role and permission to approve the loan. Under this stage, the loan can either be:
- Approved
- Rejected
- Withdrawn by the client.
In this stage the loan application can be modified.
Approved
Upon approval, the loan account is set to "Approved" status. This applies that the loan application has been successfully reviewed and awaiting disbursement.
Note: The loan application cannot be modified in this stage unless the loan approval is undone. See the table below for other actions that can be carried out in this stage.
Active
Here is the loan is disbursed and set to "Active" status. The loan account will remain active even after repayment.
Below are the actions that can be carried out at each stage of the loan lifecycle.
| Loan Status | Actions | Description |
|---|---|---|
| Pending loan | Loan account created, awaiting approval | |
| Approve Loan | Loan approved | |
| Modify Loan Application | Pending approval | |
| Reject Loan | Loan rejected/canceled. | |
| Assign Loan Officer | New loan officer, pending approval | |
| Withdrawn by client | Loan canceled | |
| Delete Loan Application | Delete or cancel loan application | |
| Add collateral | Modify loan application; pending approval | |
| Approved | Approved, awaiting disbursement | |
| Undo Loan Approval | Pending approval | |
| Disburse Loan | Active | |
| Assign loan officer | Add a new loan officer. | |
| Withdrawn by client | Loan canceled | |
| Delete loan application. | Loan canceled | |
| Add Collateral | Approved | |
| Active | Disbursed, awaiting repayment. | |
| Prepay Loan | Active if the balance owing is greater than zero. Closed (Obligation Met) if balance is equal or less than zero | |
| Foreclose Loan | Closed (Obligation Met) | |
| Repayment | Active if the balance owing is greater than zero. Closed (Obligation Met) if balance is equal or less than zero | |
| Undo disbursal | Approved | |
| Add and view the guarantor. | Active | |
| Waive interest | Active | |
| Reschedule loan | Closed (Written Off) | |
| Write Off Loan | Closed (Written Off) | |
| Generate letter | Active |
Updated 12 months ago