em>This article originally appeared in the January/February 2015 issue of NEFA Newsline Vol. 7 No. 1. All rights reserved. There is a lot of alternative capital on the street right now, and companies that are tapping into these hedge fund, small bank, and "friends and family" monies are growing their lease portfolios. Growing portfolios often present a decision point should servicing be done in-house or should it be outsourced to an established provider? Generally, timing, scale, staffing, and control of the customer experience come into play when the two options are evaluated. Recently, after weighing the pros and cons of an in-house servicing model, many have chosen to outsource servicing as part of a long-term strategy. Timing Ready access to capital has resulted in the present fertile climate to grow an on-book portfolio while simultaneously providing funding diversification. These unprecedented economic conditions have offered brokers/lessors the opportunity to rethink how they want to fund a customer's leases. Options are to continue capitalizing on the lower cost of funds through an upfront commission structure or grow an on-book portfolio realizing higher spreads over time. In most cases, the alternative funding lenders either allow for servicing to be retained or require it. An outsourced servicing model allows you to immediately tap into the alternative money that produces those higher spreads. When lenders require an established servicing structure, they can be reassured by a qualified outsourced partnership that gives turnkey access to experienced employees and system solutions with proven lease processing practices. Additionally, a new niche opportunity may require an alternative funding source and a servicing need unavailable with conventional funding partners. Subtle differentiations such as this are often the deciding factors in winning or losing business.
ABOUT US GreatAmerica Portfolio Services Group (GPSG) is a lease and loan outsourcing service provider specializing in third party and backup servicing. We focus on developing mutually beneficial relationships with banks, independent financial companies, captives, vendors, manufacturers, trustees and financial investors, ultimately helping them achieve greater success. NOTES FROM THE FIELD Third Party Servicing – Captive Leasing Companies A common funding model for captives is to use multiple funding sources under a private label servicing arrangement. While private labeling enhances brand awareness, there are no guarantees on multiple sources providing a consistent customer servicing experience. Captives can control the customer experience and benefit from a single servicing/multi funding arrangement. This can be achieved by providing a single invoice to the customer, which the servicer can then segregate cash and send to the multiple funding sources. Through a partnership with a servicing partner, the captive not only controls the customer service levels and enhances their brand equity, but they also have a single reporting structure which provides compiled and segregated performance on their entire portfolio. Third Party Servicing – Solar Industry Update Our excitement and enthusiasm for the solar industry remains strong for 2015. Our current solar clients' growth is steady and we continue to pursue new opportunities. Our variable billing abilities, especially when working with PPAs, has continued to be a front runner and very appreciated by our clients and their clients. This also holds true for our loan and lease servicing products. Our bench depth in the solar market has been especially useful in launching our stand-alone public filings outsource offering that manages the UCC, Fixture, and CA PUC filings. We continue to apply weekly and/or daily electronic on-boarding of new contracts to handle the volume flow. Once on-boarded, our production tracking and billing, private label invoicing, cash management, account support, collections, tax compliance, and reporting have helped maintain and sustain business with our existing customer base. Our vision is to be the premier servicer in the solar industry. Outsourced Servicing – Why is it attractive? We have seen many finance companies in need of a servicing solution so they can capitalize on new access to capital and growth initiatives or place better focus on new product offerings. Of the many key advantages to outsourced servicing, the most appreciated is cost savings. Access to instant expertise is a close second. By offering a turnkey servicing solution implementation within 60-90 days, there is often minimal business disruption. A common theme among current clients is they could not have realized the immediate success without our partnered help . Our culture is customer centric and driven by helping our clients achieve greater success. EMPLOYEE SPOTLIGHT: Sarah Barnett Sarah Barnett is from Cedar Rapids, Iowa and brings a wealth of experience to the role of Sales and Implementation Specialist. Most of her nearly six years at GreatAmerica was spent in the IT department, and it was a logical transition for her to be responsible for onboarding new customers, implement IT projects, and manage configuration of the ServicerZone. "You're not just a number at GreatAmerica. . . they truly care about you," Sarah says. "GreatAmerica goes above and beyond to make your work life enjoyable." Sarah said she enjoys giving "that personal touch" with PSG clients. "You get to know who you're working with, develop a partnership, and have the advantage of years of leasing expertise at your fingertips to help them." JOE'S CORNER In conversations with our Clients, they shared that 2014 was very rewarding and successful - ultimately meaning it was also a very good year for the GreatAmerica Portfolio Services Group. We know our success is dependent on the success of our Clients. In reflection, I am excited to share some of our achievements from the previous year and look forward to 2015. Our goal is to be the leader in providing third party outsourced servicing solutions. Achievements: Expanded the ServicerZone front-end servicing platform to include credit processing Expanded reporting capabilities for our customers Implemented an enhanced loan servicing platform for the residential solar industry Implemented a quarterly servicing review process for our Clients Grew our third party serviced portfolio by 75% Grew our backup servicing Clients by 100% Welcomed 10 new GreatAmericans to our servicing team 2015 Focus Areas : Continued growth and development of our Team Technology enhancements geared towards customer needs Providing value-add servicing solutions to captives, banks and solar opportunities Enhance our services and products to improve our value proposition to our clients The GreatAmerica Principles include building enduring relationships with our Clients while being committed to mutual success. In 2014, we continually created awareness to our servicing team about the importance of a positive experience in every interaction with our Clients or their customers. We will do the same in 2015. Our customers, investors, and communities need to be proud of their association with us based on our reputation for hard work, integrity, excellence, and history of success. Whether you are a customer, prospect, or a friend of GreatAmerica Portfolio Services, we wish you a prosperous 2015! Joe Andries Vice-President & General Manager GreatAmerica Portfolio Services Tel. 877-762-3808 or 507-929-5117 Fax 877-762-3809 email@example.com PAST NEWSLETTERS Vol. 1, Fall 2012 Vol. 2, Winter 2012 Vol. 3, Spring 2013 Vol. 4, Summer 2013 Vol. 5, Fall 2013 Vol. 6, Winter 2013 Vol. 7, Spring 2014 Vol. 8, Summer 2014 Vol. 9, Fall 2014 Benefits of a Servicing Partnership with GreatAmerica Portfolio Services Group Alignment with an Industry Recognized Leader Commitment to the Industry's we serve Financial Strength Proven Servicing Platform Flexible Servicing Approach Customer Focused Culture Exceptionally Trained Employees Leading Edge Technology WOW! Award Each month The WOW! Award is presented to employees and teams that have gone above and beyond to provide our customers the GreatAmerica Experience. These are just a few customer praises: em> "I've sinceerely enjoyed working with your team and feel like we've made tons of progress together. We've resolved an uncountable number of homeowner issues together and while it hasn't always been easy dealing with the customers, it's always been a pleasure working with your team." em> "I'd like to thank Jayna for very patiently and porfessionally helping me with understanding my solar panel agreement. I've trained administrators like Jayna for the past 25 years and would place her as the best. CALENDAR ABS Vegas 2015 Las Vegas, NV February 8-11, 2015 ELFA Equipment Management Conference Miami, FL February 22-24,2014 Investors Conference on Equipment Finanace New York, NY March 12, 2015 NEFA Finance Summit Long Beach, CA March 18-20, 2015 Solar Power Finance & Investment Summit San Diego, CA March 25-26, 2015 ELFA National Funding Conference Chicago, IL April 21-23, 2015 Sunshine Backed Bond Conference New Yourk, NY April 30-May1, 2015 Copyright © 2015, All rights reserved. GreatAmerica Portfolio Services | One GreatAmerica Plaza | 625 First Street SE | Cedar Rapids, IA 52401
ABOUT US GreatAmerica Portfolio Services Group (GPSG) is a lease and loan outsourcing service provider specializing in third party and backup servicing. We focus on developing mutually beneficial relationships with banks, independent financial companies, captives, vendors, manufacturers, trustees and financial investors, ultimately helping them achieve greater success. NOTES FROM THE FIELD Third Party Servicing – Solar Industry Update As the solar industry continues to grow, our focus is on helping our customers gain market share by bringing enhancements to the servicing side of residential solar contracts/agreements. We are eliminating some of the manual aspects of the servicing process (e.g. public filings and cash posting) and placing more emphasis on efficiency. While economies of scale are requiring this, the home owner's experience remains a priority. Our staff is constantly looking for ways to improve day to day work flow and bring new offerings to the table. In fact, we are assisting customers in launching a "loan" product as an alternative to a lease or power purchase agreement (PPA). This broader array of financial offerings is a telltale sign of greater maturity in the solar industry as its constituents become more comfortable with lender and investment opportunities. Our commitment to the solar industry has never been stronger, and we feel fortunate to be an integral part of the growth of this exciting industry! Third Party Servicing – Banking Industry Update Banks are growing the equipment leasing asset side of their portfolio with renewed vigor. They are faced with excess loan capacity (not 100% loaned out) and equipment leasing portfolios are very attractive at this time. While still important, there is less conversation around performance and more around yield enhancement and growth. For banks entering the space within the past two years, it has been a very good decision. Our bank customers have experienced significant growth and impressive performance. The common denominator for success appears to be a combination of top leadership support and a willingness to invest in a "leasing person" or team to shepherd the opportunity. We provide support of these initiatives through our experienced people, proven leasing platform, and established lease processes. We expect to see continued leasing growth and exceptional performance from our bank customers – the outlook is very good. Third Party Servicing – Equipment Leasing Industry Update "Competitive" is how I would describe the current equipment lease and finance landscape, with every lessor working hard to maintain and grow market share. Our mission is to add value to all our customers. It is now more viable for leasing divisions of banks, captives, and independent lessors starting or growing an on-book lease portfolio. They can be free to focus on their core competency of sales or originations and use us for operational tasks. This model also gives our customers complete control of their customer base and bolsters their confidence to hold their own portfolio with the use of private funds (friends and family), institutions, or their own cash flow. We didn't see this level of confidence a year ago. A continuant servicing standard controlled by our lessor builds brand equity and repeat business...and it eliminates operational and compliance barriers! Backup Servicing – Definition of Hot, Warm, & Cold? Recently, we were asked how we define backup servicing assignments. This has been a common question for many years, and it prompted us to think of why there isn't a universal definition for "Hot", "Warm" or "Cold" backup servicing. Although varied definitions will continue to be present, the focus remains constant on diminishing the servicing risks through a viable backup serving partner . We've applied the following definitions based on acceptance by major investors, rating agencies and issuers: Hot Daily, weekly, and monthly data file storage, data mapping and testing, portfolio monitoring and review, periodic on-site operational reviews, transition planning, resource allocation. Targeted servicing transition within 30 days. Warm Monthly data file storage, data mapping, portfolio monitoring and review, initial onsite operational review, transition planning. Servicing transition 30-60 days. Cold Semi-annual or annual data file storage, limited upfront data mapping, periodic portfolio monitoring and review, reservation of space on servicing systems. Servicing transition greater than 60 days. EMPLOYEE SPOTLIGHT After seven years of teaching elementary school in eastern Iowa, Sasha felt it was time for a change where she could "work with adults" and grow in a position that challenged her. She joined the Portfolio Services Group 14 months ago as an Account Support Advisor. "I love doing different types of things, from audits to imaging to filing UCCs, I always feel like I'm learning and it keeps me on my toes," Sasha says. "I especially enjoy watching PSG grow and being part of that growth, learning about new lessors and building processes that will serve them best." JOE'S CORNER Keeping the Promise... In speaking with a colleague recently, the question came up regarding "how do you find your customers?" The short answer is through direct conversation, awareness, marketing, affiliation and referral. The long answer is by making sure we are delivering value to our current customer base and keeping our promise to prospective clients. When we promise "high service levels from our employees, flexible and reliable systems, and proven procedural servicing practices," behind the scenes we are making sure we deliver on that promise day in and day out. Are we perfect? Probably not, but we take every measure to strive for that ideal. What happens behind the curtain is a large amount of time and resources to make sure our employees are trained and ready to serve, our systems are continually monitored and enhanced, and our procedures are audited and tested often. The end result; I can confidently speak to customers and potential customers about being their servicing partner and to the value we will deliver to their business model. A promise that has served GreatAmerica well for 22 years! Joe Andries Vice-President & General Manager GreatAmerica Portfolio Services Tel. 877-762-3808 or 507-929-5117 Fax 877-762-3809 firstname.lastname@example.org PAST NEWSLETTERS Vol. 1, Fall 2012 Vol. 2, Winter 2012 Vol. 3, Spring 2013 Vol. 4, Summer 2013 Vol. 5, Fall 2013 Vol. 6, Winter 2013 Vol. 7, Spring 2014 Vol. 8, Summer 2014 Benefits of a Servicing Partnership with GreatAmerica Portfolio Services Group Alignment with an Industry Recognized Leader Commitment to the Industry's we serve Financial Strength Proven Servicing Platform Flexible Servicing Approach Customer Focused Culture Exceptionally Trained Employees Leading Edge Technology Solar Facts: The U.S. Solar market enjoyed a solid Q2, with photovoltaic (PV) installations topping the gigawatt mark for the third consecutive quarter to settle at 1,133 megawatts (MW). This performance represents 21% growth over Q2 of last year and brings cumulative installed solar capacity to 15,900 MW. Through the first half of the year, 53% of all new electric capacity installed has come from solar. With over 42,000 installations in 2014 Q2, more than half a million homes and businesses have now gone solar. Through the first half of 2014, a new solar project has been installed every 3.2 minutes. The average price of a residential PV installation in Q2 2014 was $3.92/watt, 41% lower than 2010. Since the second quarter of 2010, the average price of a solar panel has declined by 64%. Over 6,500 MW of PV is forecasted to come online in 2014, representing 36% growth over 2013's record installation levels. All data from SEIA/GTM Research "U.S. Solar Market Insight: Q2 2014" CALENDAR InfoCast Solar Securitization New York, NY September 30, 2014 ELFA Annual Convention San Diego, CA October 19-21, 2014 Solar Power International Las Vegas, NV October 20-23, 2014 NEFA Expo Regional Teaneck, New Jersey November 16-17, 2014 Distributed Solar Summit San Diego, CA November 17-19, 2014 Copyright © 2014, All rights reserved. GreatAmerica Portfolio Services | One GreatAmerica Plaza | 625 First Street SE | Cedar Rapids, IA 52401 To continue to ensure delivery of our newsletters, remember to add "email@example.com" to your address book or safe senders list. update subscription preferences | forward to a friend
Reprinted with Permission from Equipment Finance Advisor