Stipulations

Stipulations are conditions or requirements that must be satisfied before a loan can be funded or an account can be opened. They serve as checkpoints in the lending process to ensure all necessary documentation and verifications are complete.

Understanding Stipulations

What Are Stipulations?

Stipulations are items added to an application that represent:

• Documents needed (pay stubs, ID, etc.)
• Verifications required (employment, income)
• Conditions to be met (collateral inspection)
• Actions to be completed (signatures, disclosures)

Stipulation Categories

Category	Examples
Income	Pay stubs, W-2s, tax returns
Identity	Driver's license, passport, utility bill
Employment	Employment verification, offer letter
Collateral	Vehicle inspection, title, insurance
Credit	Letter of explanation, paid collections
Legal	Power of attorney, trust documents
Other	Custom institution requirements

Stipulation Workflow

Status Lifecycle

┌─────────────┐
│   ADDED     │ Stipulation created
└──────┬──────┘
       ▼
┌─────────────┐
│ OUTSTANDING │ Waiting for fulfillment
└──────┬──────┘
       ▼
┌─────────────┐
│  RECEIVED   │ Document/item submitted
└──────┬──────┘
       ▼
┌─────────────┐
│UNDER REVIEW │ Being evaluated
└──────┬──────┘
       ▼
   ┌───┴───┐
   ▼       ▼
┌─────┐ ┌─────────┐
│PASS │ │  FAIL   │
└─────┘ └────┬────┘
             ▼
       Back to OUTSTANDING
       (with reason)

Status Definitions

Status	Description	Action Required
Outstanding	Not yet received	Request from applicant
Received	Item submitted	Review and evaluate
Under Review	Being evaluated	Complete review
Pass	Requirement satisfied	None
Fail	Not acceptable	Re-request with reason
Waived	Requirement waived	Document reason
N/A	Not applicable	Document reason

Managing Stipulations

Adding Stipulations

Manual Addition:

1. Go to Documents tab
2. Click Add Stipulation
3. Select stipulation type
4. Set parameters:
   • Required or optional
   • Due date (if applicable)
   • Assigned to (if applicable)
   • Notes/instructions
5. Click Add

Automatic Addition:

Stipulations can be automatically added based on:

• Rule engine results
• Product requirements
• Applicant profile
• Risk assessment
• Decision conditions

Clearing Stipulations

To clear a stipulation:

1. Receive document/verification
2. Review the submitted item
3. Verify it meets requirements:
   • Document is legible
   • Information is current
   • Names/amounts match
   • All pages included
4. Click Pass if acceptable
5. Click Fail if not acceptable (with reason)

Waiving Stipulations

Some stipulations may be waived under certain conditions:

1. Click Waive on the stipulation
2. Enter business justification
3. May require supervisor approval
4. Waiver is recorded for audit

Waiver Controls

Waiving required stipulations may require:

• Approval authority level
• Supervisor override
• Documented compensating factors
• Compliance review

Rule-Based Stipulations

Pre-Bureau Rules

Stipulations added before credit pull:

Condition	Stipulation Added
Self-employed	Tax returns (2 years)
New employment	Offer letter
Commission income	YTD pay stubs
Rental income	Lease agreement

Post-Bureau Rules

Stipulations added after credit analysis:

Condition	Stipulation Added
Collections > $500	Paid receipt or LOE
Recent bankruptcy	Discharge papers
Address mismatch	Proof of address
Name variation	Name verification

Collateral Rules

For secured loans:

Condition	Stipulation Added
Vehicle loan	Title, insurance
High LTV	GAP insurance
Older vehicle	Inspection report
Out of state	VIN verification

Stipulation Best Practices

For Processors

1. Clear Communication

   • Explain what's needed clearly
   • Provide examples if helpful
   • Set realistic due dates
   • Follow up promptly

2. Efficient Review

   • Review documents same day
   • Reject quickly with clear reasons
   • Don't hold applications unnecessarily
   • Escalate issues promptly

3. Documentation

   • Note any special circumstances
   • Document waiver reasons
   • Record follow-up attempts
   • Maintain audit trail

For Underwriters

1. Consistent Standards

   • Apply rules uniformly
   • Document exceptions
   • Know approval authority
   • Escalate when appropriate

2. Risk Assessment

   • Consider compensating factors
   • Document reasoning
   • Balance risk and service
   • Follow policy guidelines

Stipulation Reports

Tracking Metrics

Metric	Description
Outstanding Count	Total unfulfilled stipulations
Aging	Days stipulation outstanding
Clear Rate	% cleared vs. requested
Waiver Rate	% waived vs. requested
Processing Time	Time from received to cleared

Common Reports

Report	Purpose
Outstanding Stipulations	All unfulfilled items
Stipulations by Type	Volume by category
Aging Report	Items outstanding by days
Waiver Report	Waived items with reasons
Processor Performance	Clearing time by user

Applicant Communication

Requesting Documents

When requesting items from applicants:

1. Send request via preferred channel (email, SMS, portal)
2. Include clear instructions
3. List specific requirements
4. Provide upload link or instructions
5. Set response deadline

Sample Request Template

Subject: Documents Needed for Your Loan Application

Dear [Applicant Name],

To continue processing your loan application, we need the following:

□ Most recent pay stub (within 30 days)
□ Government-issued photo ID

Please upload these documents by [Date] using this secure link:
[Upload Link]

Questions? Contact us at [Phone/Email]

Thank you,
[Institution Name]

Follow-Up Process

Day	Action
Day 0	Initial request sent
Day 3	First reminder
Day 7	Second reminder
Day 10	Phone call attempt
Day 14	Final notice
Day 21+	Consider withdrawal

Integration with Workflow

Impact on Status

Stipulation status affects application:

All Stipulations	Application Impact
Outstanding	Cannot fund/book
Under Review	Pending completion
All Passed/Waived	Ready for funding
Any Failed	On hold for re-request

Funding Requirements

Before funding, ensure:

• All required stipulations cleared
• Optional stipulations addressed or waived
• Documents signed
• Collateral (if any) processed
• Insurance verified (if required)

Troubleshooting

Common Issues

Issue	Solution
Can't waive stipulation	Check authority level, get supervisor
Document won't upload	Check file type/size, try different format
Stipulation missing	Manually add or check rule configuration
Wrong category	Delete and re-add with correct type
Applicant didn't receive request	Verify email/phone, resend

Escalation Path

1. Processor → Senior Processor
2. Senior Processor → Underwriter
3. Underwriter → Senior Underwriter
4. Senior Underwriter → Loan Manager
5. Loan Manager → Compliance (if needed)

---

Continue to Offers & Underwriting to learn about the underwriting decision process.