Welcome to the final article in our series on SBA Screen Outs. You can find the others by following these links: Errors in Loan Origination Packages, Errors in Guaranty Purchase Packages, and how Screen Outs can be a positive thing for your team (really).
In the last article, we focused on some positive takeaways from receiving and responding to Screen Outs in your Loan Origination and Guaranty Purchase packages. And, it’s important to understand their potential negative impact.
These three points are worth your careful consideration.
1. Reputational risk
SBA pays attention to the volume as well as the trends in each Lender’s Screen Outs. And that is not what you want to be known for. Instead, do your best to reduce the volume and repeat issues in your Screen Outs. This is where the points we made in the previous article on the potential positive results come into play: what you can learn and how you can improve.
2. PARRiS Score
Having a large volume of Screen Outs with repeat issues could impact your PARRiS score. A dramatic change in your score, or even a steady decline, could lead to a full SBA audit. That’s plenty of motivation to keep your score out of harm’s way!
3. PLP Status
Obtaining and maintaining your PLP status is driven by more than just your loan volume or portfolio performance. Your overall performance as a lender and your PARRiS score are significant factors – factors that can be impacted by the volume and types of your Screen Outs.
Remember when your English teacher returned your essay with all those redlines and remarks and made you rewrite it? A Screen Out can feel like that. The best way to avoid them is to slow down, double check your work, and clean up processes and procedures as needed to reduce the number of Screen Outs you have to manage. Focus on once and done – and make that done well! – and you’ll avoid the dread and stress.
And as always – if you have questions or want to explore some help in managing your Screen Outs, just get in touch and we’ll see how we can support you.