LoanStreet maintains an index of borrower payments and also helps you distribute borrower payments to each loan’s syndicate. When initially publishing the loan or when updating the payment index, you simply navigate to the Payments tab of the LoanFile for each loan.
Once there, click on “New Payment” in the upper right hand corner. Select the payment date and then provide the payment composition. For each payment, first, determine whether the portion of the payment is for the benefit of the syndicate and the originator (in the form of the un-syndicated portion of the loan) or solely for the benefit of the originator (such as an interest rate spread, if any). Then, enter the appropriate amounts for items such as principal, interest, fees, interest rate spread or eligible borrower expenses. You can also use the memo functionality to provide a description of the payment to the syndicate. To write a memo, click on the pencil icon, which will result in a pop-up text box for you to type your description. Return to edit the memo at any time.
The proper accounting of principal payments is critical to the functioning of LoanStreet. When principal payments are recorded, LoanStreet updates the remaining principal balance and the principal amount available for purchase. This ensures that any new purchase by a syndicate member accurately sets forth the percentage of the loan being purchased and that no purchase results in loan assignments beyond your Maximum Syndication Percentage.
Finally, record the distribution of that payment to the syndicate by selecting either “New Distribution (Auto-Populated)” or “New Distribution (Manually Populated)”.
When selecting the auto-populate option, LoanStreet will automatically take the amount representing the payment for the Originator & Syndicate and proportionately divide the payment to the syndicate based on the percentage of each member’s interest in the loan. LoanStreet then provides you with the option of having LoanStreet syndicate the amount to the syndicate or allowing you to manage that part of the process yourself.
If you choose to have LoanStreet distribute the funds, LoanStreet will send you wire instructions for the full amount of the syndicate payment. Alternatively, you can agree to have LoanStreet reverse wire those amounts automatically if you have a reverse wire agreement in place.
All Syndicate Members can view the entire historical payment index but can only view distributions made directly to them. Syndicate members cannot view distributions made to any other syndicate member.
LoanStreet will automatically notify syndicate members each time a new distribution is initiated.