Loan Securities: Collateral and Guarantors

Woodcore offers organizations the ability to enhance the security of their clients' loans by adding loan securities. These securities serve to secure or guarantee a specific portion of the loan amount. In the event of non-repayment, your organization will have the means to collect a portion of the outstanding loan from the pledged securities.

There are two types of securities:

Collateral

Collateral can be added to loan applications with “pending” or “Approved” status. When adding the collateral, the value of the collateral must be specified. In the event of non-payment, the asset can be seized as a means to recover the outstanding loan amount.

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Adding collateral to a loan account application does not affect the loan account application's status.

Guarantor

Guarantor(s) can be added to an “Active” loan account. In the event that the loan customer is unable to repay the loan, the guaranteed amount provided by the guarantor can be utilized to cover the outstanding balance. It is not required that the guarantor be a customer with an account in your organization.

On Woodcore, there are two types of guarantors.

• Internal guarantors: These are customers who have one or more accounts within your organization. When adding an internal guarantor, you have the option to select which of the customer's accounts the loan client wishes to use as a guarantee.
• External guarantors: These are individuals who do not have an account in your organization. However, they can still be added as guarantors. You are to provide the necessary information of the external guarantor, such as their name, address, mobile number, and other relevant details.

By accommodating both internal and external guarantors, Woodcore offers flexibility in securing loans and provides options for clients to choose the most suitable guarantor for their loan requirements.