BHPH Portfolio Due Diligence Checklist

Closing preparation guide

Published September 26, 2026 | By Robert Hicks, Senior Portfolio Buyer

Use two stages instead of sending everything at once

The FTC says financed-customer lists and related financial information can be customer information subject to safeguards. Use an approved secure channel, restrict access, and collect only what the review requires.

Account tape checklist

• Stable dealer account ID with no duplicate rows
• Origination or sale date and first payment date
• Original amount financed, current principal or payoff balance, payment amount, and frequency
• Last successful payment date and amount, next due date, and days past due
• Total collected and a clear count of completed payments
• Remaining term and contractual maturity
• Vehicle year, make, model, VIN, and available mileage
• Title and lien status
• Bankruptcy, repossession, charge-off, dispute, insurance, warranty, GAP, and document exception flags

Payment and servicing history

• Transaction-level ledger with dates, amounts, and transaction types
• Separate successful payments from reversals, refunds, NSF items, fees, adjustments, and insurance proceeds
• Extensions, deferments, due-date changes, modifications, and promises to pay
• Collector notes and customer communication history when relevant to exceptions
• Credit-reporting status, disputes, and correction history if the account has been furnished

The CFPB's automobile finance procedures treat payment processing, collections, repossession, bankruptcy, credit reporting, information sharing, and privacy as distinct review areas. Preserve that detail rather than reducing the history to one delinquency bucket.

Contract and collateral file

• Executed retail installment contract or other receivable instrument
• Credit application and required origination disclosures
• Bill of sale and vehicle delivery records
• Title, lien perfection evidence, and any power-of-attorney or assignment documents
• Signed modifications, deferments, extensions, or payment-plan changes
• Warranty, service contract, GAP, GPS, starter-interrupt, and insurance records when applicable
• Repossession, sale, redemption, reinstatement, and deficiency records for affected accounts
• Bankruptcy case and claim records for affected accounts

Build an exception list before the buyer finds one

Use one row per account and one column per exception. State the condition, the supporting document, the person responsible, and whether the issue can be cured before closing. Typical exceptions include missing title, unreleased prior lien, unsigned contract page, balance mismatch, duplicate account, unreadable scan, pending bankruptcy, active repossession, pending insurance claim, customer dispute, or recent payment reversal.

Four reconciliation controls

1. Count: account count on the tape equals the proposed purchase schedule.
2. Balance: aggregate and account balances tie to the DMS as of the cutoff.
3. Cash: payments between cutoff and closing are identified and allocated.
4. Status: every bankruptcy, repossession, charge-off, payoff, and disputed account is updated before signing.

Servicing-transfer checklist

• Final account schedule and assignment documents
• Customer and payment-channel communication plan
• ACH, card, lockbox, cash, and mail handling around the cutoff
• Welcome or servicing information and support contact
• DMS status changes only after closing approval
• Credit-reporting and dispute ownership
• Physical and electronic document delivery log
• Named contacts for post-closing questions and exception cures

The OCC and FDIC both emphasize independent due diligence and clear documentation of transfer, servicing, defaults, collections, and recourse in loan-purchase activity.