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Oracle Loans User Guide
Release 12.1
Part Number E13646-04
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Funding A Loan

This chapter describes how to fund a loan.

This chapter covers the following topics:

Overview of Loan Funding

Oracle Loans integrates with Oracle Payables to disburse funds to borrowers or third party closing companies when a loan is approved. Funding is available for direct loans only.

After the loan manager approves a loan application, the loan funding officer authorizes a funding advice to disburse funds from Payables. The funding advice can be generated automatically when the loan is approved or submitted manually. Loans allows only one funding advice for a loan.

Tip: Use the Funding Option check box on the Approvals page to select automatic funding advice.

Select a payment method for disbursing funds when you enter the payee information. Funds can be paid using payment methods supported by Oracle Payables, such as check, electronic funds transfer, and wire transfer.

Oracle Loans integrates with Oracle Payments for loan funding to borrowers and third party agencies. For further information on adding a payee, see: Adding a Payee. For detailed information, see: Oracle Payments Implementation Guide.

For loans with multiple disbursements, you can cancel remaining unpaid disbursements. Enter the reason for cancellation in the notes for the loan manager to consider your request.

Note: You can Cancel Disbursements only for Approved loans. Incomplete loans or loans pending approval can be rejected and hence the Cancel Disbursements button is unavailable.

Note: If the remaining disbursements of a loan are canceled, you can either collect all the previously disbursed funds or continue to bill fees and interest on the disbursed funds until paid off.

Funding Process Flow

The following lists the steps in the funding process.

If an error occurs during invoice import or validation, Payables updates loan status to Funding Error.

Note: For prioritized funding, when the loans manager approves the loan, the loan application appears in the Dashboard's Funding Queue with a status of Approved. The loans manager then reviews the application and, creates the payee information in Funding, and clicks Submit to create the invoice in Oracle Payables.

Updating Funding Status

Oracle Loans interacts with Oracle Payables to check the status of a funding advice and updates the loan status in Loans. When a funding advice disbursement is fully paid, Loans fetches data from Oracle Payables to update the loan status to Active and updates the Loan Start Date and Payment Start Date. For a description of all loan statuses, see Updating Loan Status.

Funding and Loan Dates

When you create a loan application, you enter estimated dates for the loan start date and the first payment date. When a loan is fully funded and its status is Active, Loans updates these dates and establishes the funding date.