NACHA Returns Per Payment Profile

General

LoanPro has a few features to help lenders comply with the small-dollar payment rule. This rule requires that if a payment profile (e.g. bank account) has two consecutive payments returned, then the owner of the payment profile must reauthorize it's use before the lender can try to use it to process another payment.

Payment Profile History

A history if the use of a payment profile can be found within LoanPro. To view the history, go to Any Customer Profile > Payment Profiles and the choose View History from the payment profile menu.

This will show all of the payments made by the payment profile, regardless of the loan on which they were made.

More information can be viewed about each payment by clicking the chevron at the far right.

This will make it easy to see the total history of a payment profile.

Multiple Returns

LoanPro offers options to automatically change the status of AutoPays that fail through our NACHA Returns functionality. To help with multiple returns on a single payment profile, we offer a similar function called Multiple Returns.

To access Multiple Returns, navigate to Settings > Company Settings > Merchant > Multiple Returns inside your LoanPro account.

Here you can set up rule-based actions that will be taken based on the failure of a payment or mulitple payments for a payment profile.

To add a new rule, click

Now you can choose when to trigger an action, and also trigger a loan settings update that will update the loan settings as well.

Trigger

In the top section, choose when an action for a payment profile and the associated loan will be triggered. To do this, enter the following information:

  • Status - This just specifies whether this action will be active on your account or not.
  • Name - Give a name to this action to distinguish it from others you might create.
  • NACHA Returns - Specify the return codes that will be included to trigger this action. Use the + to add more return codes if you'd like to use multiple.
  • Number of Returns - This is the number of returns for the specified return code(s) that will trigger the action.
  • Evaluated based on - This will let you choose whether the number of returns is a total number for a give payment profile, or whether it's consecutive returns.
Rule

Click Empty to enter a rule that will limit the loans that this qualifies to. For example, if you would like loans inside of Portfolio 1 to have the payment profile inactivated for 2 consecutive R02's, you would enter a rule that says (= (-> portfolio :1 :active) 1), this would limit the evaluation of payment profile inactivated to only happen if the loan is assigned to Portfolio 1.If you would like to leave this qualification wide open (and not limit any loans), then you can write an all encompassing rule like:(or (<= status-payoff 0) (>= status-payoff 0))

How is the Trigger Evaluated?

If the “Evaluate based on” setting is “Total Returns”: 
  • LoanPro will count the frequency of each return code that appears in the history of a payment profile (e.g. 2 R01’s, 1 R08, and 1 R02).
  • LoanPro will find the sum of each count for qualifying (i.e. selected in the trigger) return codes (e.g. 2 R01 + 1 R08 = 3). 
  • If that sum is equal to or greater than the number found in the “Number of returns” setting for the trigger, then apply the payment profile changes.
  • Compare every loan that the payment profile is associated with, with the Clojure rule found in the trigger.
  • In order for the loan to be associated with the payment profile, then the loan must be linked to a customer that is associated with the payment profile.
  • If the loan is correctly associated with the payment profile and it qualifies for the Clojure rule, then LoanPro will apply the designated action to the loan.
If the “Evaluate based on” settings is “Consecutive Returns”:
  • LoanPro will sort the payment profile history by descending order according to log date.
  • LoanPro will look at the most recent “X” number payments in the table. (X being the number specified in the “Number of returns setting in the conditional qualification)
  • Are all payments in the top “X” in a reversed/failed status? If no, it does not qualify
  • Do all payments in the top “X” have a NACHA Return Code? If no, it does not qualify
  • Do all payments in the top “X” have a NACHA Return Code that is specified in the trigger? If no, it does not qualify
  • If yes, then apply the payment profile changes

Action

Payment Profile

The first piece of the action lets you define what should happen to the payment profile or associate AutoPays when the trigger event occurs. This is not contingent on the rule evaluating to true.

Loan Changes

The remaining portion of this page works the way rules applied does. You can set changes that should happen to the loan settings, or custom fields for loans that qualify based on the Clojure rule. The most common uses for this include things like changing loan status or adding a portfolio so that the loan can be reviewed to ensure payments can be processed well in the future.


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