Large commercial lenders with internal departments usually have staff personnel performing this function.

These lenders may be better able to absorb the overhead costs associated with loan control services. Medium and smaller sized organizations however, are at a greater disadvantage. These Lenders are caught between competitive forces and regulatory pressures. These banks are seeking a cost effective and efficient source for services.

The engineering analysis of construction loans includes the cost valuation of the improvements as well as a technical review of all documentation, including a toxic and flood hazard determination. Historically, a loan processor employed by the Lender administers these tasks and contracts with the services of an outside data vendor and or service consultant.

The cost of providing an upfront cost analysis and document review, along with an ongoing disbursement fund control inspection, can cost the Borrower from .25% to 2.5% of the loan amount.

These services in most cases are passed through by the lender and are provided from multiple consultants (i.e. a cost engineering or appraisal firm would provide the cost analysis report, an environmental firm would provide the pre-phase one radius search. A flood hazard determination firm would provide the flood information, etc.).

Hardcopy reports are turned around in approximately 5-10 days. The proposed website would offer the same menu of services from a single source at a lower cost, falling between .25% to .75% of the loan amount, and in contrast to conventional methods would be turned around in minutes. The reason ISBS offers more competitive rates is due to the following:


· A national network of certified inspectors and engineers
· A Central processing plant that will be able to cut input time and improve accuracy
· A wireless field based input system
· An interactive website that will be able to make the exchange of information more cost effective.

© Copyright 2004 by ISBS GROUP

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