Overview

In the lending industry, CPF (Cost Per Funded Loan) provides an at-a-glance measure of how much it costs to convert a single lead into a funded loan. This key performance indicator (KPI) combines several cost components—such as Data Bureau fees, Lead Costs, and IBV (Instant Bank Verification) fees—and divides that total by the number of funded loans.

Our Leads Summary report displays how many leads are:

• Viewed: Leads that your team or system has looked at.

• Accepted/Purchased: Leads that you decide to pay for.

• Converted: Leads that ultimately become funded loans.

Using the data in the Leads Summary alongside your cost data provides a comprehensive view of your CPF and helps identify which lead sources perform best.

How CPF Is Calculated

CPF=Data Bureau Costs + Lead Costs + IBV CostsTotal Funded Loans\text{CPF} = \frac{\text{Data Bureau Costs + Lead Costs + IBV Costs}}{\text{Total Funded Loans}}CPF=Total Funded LoansData Bureau Costs + Lead Costs + IBV Costs​

1. Data Bureau Costs

   • Fees for credit checks and other third-party data services (e.g., Experian).

   • Pulled from your Lead Source settings, based on your average or negotiated rates.

2. Lead Costs

   • The amount you pay the lead provider(s) for each accepted or purchased lead.

   • These costs vary by provider and are also stored in Lead Source settings.

3. IBV (Instant Bank Verification) Costs

   • Fees associated with verifying a borrower’s bank account details.

   • Also managed within your Lead Source configuration.

4. Total Loans Funded

   • The number of leads that actually close/fund within a given time frame.

Locating & Managing Your Cost Estimates

All of the costs used in your CPF calculation are pulled from your Lead Sources configurations. To view or update these:

1. Go to Admin > Lead Sources in your system.

2. Click the View button next to the specific lead source you want to examine.

3. Scroll to around the midpoint of the “waterfall” section, where you’ll see individual cost fields for Data Bureau fees, Lead Costs, IBV Costs, and any other applicable charges.

These figures drive the calculation of your CPF, so keeping them up to date (and accurate) is crucial.

Why CPF Matters

1. Apples-to-Apples Comparison of Lead Providers

   • By comparing the CPF across different lead sources, you can identify which ones deliver higher-quality leads—i.e., leads that cost less on average to convert.

2. Indicator of Lead Quality

   • Purchased Rate is often inversely proportional to your Data Bureau costs; a lower purchased rate can indicate that your Data Bureau is rejecting more leads for poor credit.

   • A higher purchased rate suggests better lead quality (and hence lower Data Bureau costs).

3. Conversion Rate & Loan Quality

   • New Loan % (conversion rate) tells you how efficiently you turn leads into funded loans. A higher conversion rate usually lowers your CPF—unless you see higher write-off rates.

   • Always watch for default rates: a high conversion rate with significant losses can be counterproductive.

4. Transparent Cost Analysis

   • CPF consolidates all acquisition costs into one KPI, giving you a quick way to see if your expenses are out of balance with funded loans.