Create a Master Loan Product
Overview
A Master Facility lending product is a blueprint for the Master Facility parent contract.
Create a Master Facility Lending Product
You need to first create a Master Facility product to be able to create the Master Facility parent contract.
Prerequisite
Before creating a Master Facility lending product, ensure that the following prerequisite is met:
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Master Facility flag is enabled.
Note:For more information on enabling the Master Facility flag, see Enable Loan Features section in the CL Loan Administration Guide.
Steps
To create a Master Facility lending product of the record type Master Facility:
Log in to your Salesforce account.
Click (App Launcher).
Search for CL Loan, and then click it.
Click Lending Product.
Click Create New Lending Product.
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In the New Lending Product window, select the Master Facility Product Record Type, and then click Next.
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Specify the details as mentioned in the following table, and then click Save:
Field Action and Information Information This section captures the basic information about the lending product. You can define the basic terms that govern the contracts for the lending product. For example, whether any interest-only period and pre-bill days are applicable for this product, or any interest only payments are allowed. Loan Product Name Specify the name of the loan product. For example, Master Facility Housing Product.
This field is mandatory.
Product Type This field automatically displays the value Master Facility.
New Master Facility Lending Product: Product Type field
Interest Calculation Method Select the method for calculating the interest component of the payment.
Supported Options:
- Declining Balance: This is based on the outstanding loan balance. It is the balance money that remains in the borrower’s hands as the loan gets repaid during the loan term. As the borrower repays installments, the outstanding loan principal declines over time. The interest is then charged only on this outstanding principal.
- Flat Rate: Here, the Interest is computed on the original amount every month.
- Future Value Based: Here, the system calculates the future value of a loan, and the difference between that value and the present value of the loan is calculated as interest.
Example
Consider a loan contract where 12% interest is charged on a loan amount of 10,000 and accrual start date is March 1, 2015. Assume that the time counting method is Actual Days, therefore, the number of days in a year would be 365 days.
On March 6, 2015, the interest accrued after five days is 16.44. If a payment of 1016.44 is made, the principal paid is 1000 and interest paid is 16.44.
In Declining Balance: From March 6 onward, the interest is calculated on the remaining principal of 9000 thereafter, instead of the original 10,000.
In Flat Rate: From March 6 onward, the interest is calculated on the original principal of 10000. The interest accrued till March 11, that is after another 5 days, is again 16.44.
Future value based :
With compounding frequency as Semi annual, on March 6 2015, Interest accrued = 15.98.
From 6th March until due date it will still calculate the interest for 10,000. And from then on, based on whether the payment has happened or not, it will calculate the Loan balance = Principal remaining + interest capitalized + Fee capitalized.
If bill was not paid then Loan Balance = 10,000 + interest capitalized.
On payments made by borrower, the interest is computed at 5% during the month of March, on original principal amount, at 10% on the remaining principal balance during April, May and June, respectively, and then at 15% during the month of July.
Payment Frequency Select the frequency at which the borrower must repay the loan amount. You can override this value at the contract level.
Supported Options:
- Daily
- Weekly
- Bi-weekly
- Semi-Monthly
- Bi-Monthly
- Monthly
- Quarterly
- Semi-Annual
- Annual
- Single-Payment
- Semi-Monthly-PD.For Semi-Monthly-PD, the difference between the first and the second payment dates specified on the CL Contract page must be equal to or greater than four days and less than 31 days.
By default the value selected for this field is Monthly.
Note:PD means Pay day. In Semi Monthly, we add 15 days to start date and get the next date. But in the Semi Monthly PD, the user will need to give first and second payment date and that will be followed. For example, in Semi Monthly, if first payment date is 1st March, then next payment date is 16th March, and next is 1st April and so on. But in the Semi Monthly PD, if first payment date is 1st March and second payment date is 17th March, then next date will be 1st April and next is 17th April. In Semi Monthly PD, since they are giving the second date also it can be more or less than 15 days.
Time Counting Method Select the method for considering the days of the year for calculation of interest.
Supported Options:
- Month and Days, which indicates 360 days per year. This method eases the calculation of days between two dates, and each month is considered to have 30 days. Quarterly, bi-monthly payment periods are easily calculated as 90 and 60 days respectively, for example.
- Actual Days, which indicates 365 days per year. Each month is treated as per the actual days. This ignores February 29.
- Actual Days 366, which indicates 366 days per year. This option is configurable. It uses 366 days for leap years and 365 for non-leap years.
Interest Only Period Select the time during which the borrower pays only the interest and no principal amount is recovered. This is read in conjunction with the payment frequency. For example, if payment frequency is bi-weekly, and interest only period is 4, this means that the first 4 payments, covering 2 calendar months, are interest only payments. From the 5th payment, principal is also recovered. The interest calculation in this case varies from calculation based on zero interest only periods.
Note:For information on the interest only period behaviors, see theDefining Org Parameterssection in theQ2 Loan Servicing Administration Guide.
Pre Bill Days Specify the number of days before the payment due date that the bill is generated. For example, if a payment is due on the 5th of every month, and pre-bill days are 4, the bill is generated on 1st of the month. Payment Due Days Specify the number of days from the installment date, or due generation days in case of LOC loans, within which a payment is due. This value is used to calculate the payment due date for a bill.
You can specify either none, or only one of the two - Pre Bill Days and Payment Due Days, for the same lending product.
The values specified at the product level may be overridden at the contract level.
Actual Interest Only Payments Select this checkbox if the Actual interest only period behavior is to be adopted. If selected, system calculates the interest as per the actual payment schedule during the interest-only period.
For information on the interest only period behaviors, see the Defining Org Parameters section.
Interest Only Payment Amount Specify the amount defined by the lender for the interest only period during which only the interest amount is recovered from the borrower.
For example, in student fund loan the lender gives the facility to the borrower to pay only 100 as the interest amount for the period of six months. Hence, for six months the borrower has to pay only the interest amount which is 100 as defined by the lender.
Status Select the Status to indicate whether the lending product is active or inactive. You can create contracts only for an active lending product.
Allow Higher Certificate Rate Select the Allow Higher Investor Certificate Rate checkbox if investors can be paid at a certificate rate higher than the interest rate on the loan contract.
However, the weighted average of all the investment orders' certificate rate must be less than or equal to the loan contract’s interest rate. The system considers the weighted average only if the Allow Higher Investor Certificate Rate checkbox is selected while creating the lending product. Else, it considers the default certificate rate.
For more information on conditions under which investors may be paid as per certificate rate, see the Managing Investors section.
For Example,
Loan Amount 10,000 Rate of interest on a contract 12% No. of investors
Investor 1
Investor 2
Investor Share
75%
25%
Certificate Rate
10%
15%
Weighted Average Rate
75*10*+25*15/100 = 11.25%
Investor 1 paid at: 10%, and Investor 2 paid at 15% as long as other conditions for higher certificate rate are met. Accrual Based Accounting If selected, this checkbox indicates that CL Loan's accrual accounting module is to be used. Accrual Start Basis Select the Accrual Start Basis. This can be Contract Date or Disbursal Date.
It is date from which the loan must start accruing interest, and based on which payment start date must be derived.
- Contract Date, where the interest accrual starts from the contract date plus any accrual start days defined.
- Disbursal Date, where the accrual starts from the disbursal transaction date plus any accrual start days defined.
Note:- If the accrual start days are specified, and if you are using the Financial Calculator 3, then the accrual start days are added to the contract date or disbursal date while generating a repayment schedule. For further information on Financial Calculator 3, refer to Defining Org Parameters section in the CL Loan Administration Guide. For example, if you have specified the accrual start days as 5, and the contract date or disbursal date is Aug 10 2016, then the repayment schedule is generated from Aug 15 2016.
- If the accrual start days are not specified, then the contract date or disbursal date is considered.
Payment Application Mode Select the Payment Application Mode to indicate how the payment from the borrower is applied to the dues, when in excess of the payment amount.
Supported Options:
- Future Dues: Excess amount beyond the current bill amount (principal, interest amount) is reserved to apply to the next due on a contract.
- Current Dues: Excess amount beyond the current bill amount is not applied to future dues, thus not satisfying the future dues. Also, reserve amount for next due in a contract is zero in this case.
In both cases, the principal is reduced by the excess amount received from the borrower, and the current payment schedule remains unchanged. In case of Future Dues, the system uses the excess amount to satisfy any fee incurred and the subsequent bill, in that order. The borrower needs to pay only if the bill amount is not fully met by the excess. In case of Current Dues, the borrower needs to pay the next period's dues as usual.
Flexible Rate When you select this checkbox, the system allows you to add interest rate schedules to the contract when the contract has fixed type of interest. Schedule Parameters
Is Capitalization Enabled Select the Is Capitalization Enabled checkbox to enable capitalization on the unpaid interest.
This means that interest is accrued on any unpaid interest. This is achieved by adding the unpaid interest to the loan balance, and the interest gets computed on the revised loan balance. This can be enabled if interest posting is enabled.
Capitalization Frequency Select the frequency at which the unpaid interest is added to the loan balance.
Note:It is possible to enable interest posting without enabling capitalization. However if capitalization is enabled, then posting and capitalization occur at the same frequency.
Is Interest Posting Transaction Enabled Select the Is Interest Posting Transaction Enabled checkbox to create an interest posting date (specified on loan contract). This is created to indicate the interest on loan balance.
If this checkbox is selected, an Interest Posting Transaction is created on every interest posting date (specified on loan contract) to indicate the interest on loan balance, which is due from the customer. The subsequent payment from the borrower satisfies the interest amount that is posted in the interest posting transaction. Any interest accrued between the posting date and the payment date gets posted in future. If deselected, the default behavior is adopted, where no interest posting transaction gets created and the entire interest accrued till the payment date is due in the next bill.
Interest Posting Frequency Specify the frequency at which the interest is posted on the loan balance.
It is the frequency at which the interest posting transaction is created.
Note:The system supports all the frequencies that are supported by Payment Frequency except Single-Payment and Semi-Monthly-PD, and also has an additional frequency option called Billing Frequency. This frequency indicates that the system should post on the due dates, schedule dates of the loan. (This is the option used by mortgage lenders in AU.)
Supported Options:
- Daily
- Weekly
- Bi-weekly
- Semi-Monthly
- Bi-Monthly
- Monthly
- Quarterly
- Semi-Annual
- Annual
- Billing Frequency
Compounding Interest Select the Compounding Interest checkbox if the repayment schedule for the contract must be generated based on the compounded interest. If this field is selected, then the Interest Posting Frequency, Is Capitalization Enabled, Capitalization Frequency, Is Interest Posting, and Actual Interest Only Payments fields are mandatory.
The capitalization frequency is used as the compounding frequency while calculating the schedule, given that either one of the following two conditions is satisfied:
- Payment frequency is greater than the capitalization frequency
- Difference between disbursal date and repayment start date is greater than the frequency of the loan.
For example, a loan contract is created for 2,00,000 for a term of 18 months, and payment frequency as Quarterly. The capitalization frequency of Monthly is specified at the product level.
If interest compounding option is selected, the repayment schedule would be as follows:
If compounding interest option is not selected, the repayment schedule would be as follows:
Repayment Schedule
Default Minimum Amount Due Specify the Default Minimum Amount Due that the borrower must pay against a bill to avoid a late charge. This can be a number or % value and is seen in combination with the Minimum Amount Due Type field.
It is a Fixed Amount or Percent of the bill amount that a borrower must pay to avoid late charges on a payment. You can override this value at the loan contract level.
This option is available in CL Loan version <redgiant version> and later. For ongoing contracts created on earlier CL Loan versions, the existing CL Loan behavior applies, whereby, a borrower is not charged a late fee if even 1 cent is received towards a bill. Lenders need to add these fields to the definition of the loan product, to be able to apply this behavior to new contracts and to existing contracts for the remaining payments.
Example:
Loan Amount = 10000
Due Amount = 500, Payment Amount = 90, Due Date = January 31, Current System Date = February 1, Grace Period = 0.
Case 1:
Payment Amount = 90, Minimum Amount Due = 100, Minimum Amount Due Type = Fixed Amount, Payment Date = January 31.
Payment amount received (90) is less than the defined minimum due amount (100). Therefore, when the grace period is over, that is, on February 1, a late charge is created provided late fee is included in the fee set attached to the contract.
Case 2:
Payment Amount = 300, Minimum Amount Due = 50, Minimum Amount Due Type = Percent, Payment Date = January 31.
Payment amount received (300) is more than the minimum amount due (50% of due amount = 250). Therefore, when the grace period is over, that is, on February 1, no late charge is created
Minimum Amount Due Type Select the Minimum Amount Due Type. This can be Percent or Fixed Amount.
It indicates whether the minimum amount due is a Fixed Amount or a Percent of the bill amount.
The maximum value considered for Percent type is 100. This means, if a user specifies the minimum amount due as 200, but specifies the due type as %, then CL Loan considers this to be 100% and not 200%.
If a user specifies the minimum amount due, but leaves the due Type field blank, the system assumes it to be Percent.
Rounding Method Select the Rounding Method if rounding must apply to calculations of all the amounts related to the contract, such as disbursement schedule, payment schedule, any investor transactions, and interest computations. For more information, see Rounding Off.
It is a method used for rounding the amounts in transactions, accruals, bills, investor transactions, payoffs, and interest calculations.
If you change the rounding method for an existing product, then the values of different financial amounts of attached loan contracts start rounding but the error introduced before and after rounding enablement is not adjusted.
Bills generated for contracts with rounding method follow the schedule amount which is already rounded.
Digits After Decimal Specify the Digits After Decimal to define the rounding precision if you have selected the rounding method in Rounding Method field. The default value is 2.
Business Hours From the list of Business Hours that are created in the Business Hours setup at the org level, select the Business Hours to apply the business holidays on the product.
If Business Hours are not defined at product level, then the product assumes the default Business Hours.
Schedule Adjustment Method Select the method for rescheduling the payments that fall on a business holiday. The payment can be scheduled Before or After the payment due date.
Before: The payment becomes due on the previous working day.
After: The payment becomes due on the next working day.
Move Schedule Across Months Select the Move Schedule Across Month checkbox to allow the schedule to move to the previous or next month, if the payment is occurring on the last day of the month, depending on the schedule adjustment method you specify.
If selected, indicates that the payment date can be moved to the next or previous month, depending on the schedule adjustment method. This is applicable when the payment due date is the end of a month. This behavior is irrespective of the payment frequency of the contract.
For example,
If payment date = January 31, and the Schedule Adjustment Method = After.
- If checkbox is selected - The payment date is moved to February 1. For monthly payment schedules, this would mean February month has two payments - on February 1 and February 28.
- If checkbox is not selected - The payment date is moved to January 30.
If payment date = January 1, and the Schedule Adjustment Method = Before
- If checkbox is selected - The payment date is moved to December 31. For monthly payment schedules, this would mean December month has two payments - on December 1 and December 31.
- If checkbox is not selected - The payment date is moved to January 2.
Advance This section defines the range for the funds that can be advanced under contracts of this lending product. For example, the minimum loan amount for a home improvement loan may be 20,000. Min Financed Amount Specify the minimum amount that must be financed for this loan product. Max Finance Amount Specify the maximum amount that must be financed for this loan product.
This is a mandatory field.
Fee This section specifies the set of fees that apply to this loan product. Fee Set This field indicates the Fee Set to be associated with this loan product.
A fee set has multiple fees linked with it that you can select from, to include on a contract, at the time of contract creation.
Note:A fee set is not required for a Master Facility type of product.
Term This section specifies details of the term for which contracts created for this loan product can be extended. For example, a student loan may be for a minimum of 1 year and a maximum of 5 years. Min Term Specify the minimum duration for which loans must be extended for this lending product.
This value is read in conjunction with the payment frequency. For example, if payment frequency is Weekly, a minimum term of 52 means the loan must be extended for a minimum of 52 weeks. If the payment frequency is Weekly, and the Term is 24, this means a minimum term of 24 weeks.
Max Term Specify the maximum duration for which loans must be extended for this lending product. This value is read in conjunction with the payment frequency. For example, if payment frequency is Quarterly, a maximum term of 80 means the loan can be extended for a maximum of 80 quarters. If the payment frequency is Weekly, and Term is 60, this means a maximum term of 60 weeks.
Default Term Specify the default term for a loan extended for this lending product. For example, a student loan may be for 4 years by default, but the lender could modify this at the time of contract creation. Amortization Term Specify the term over which the payment by the borrower is spread. Unless you specify a value in this field, the amortization term is the same as the default term or the maximum term, as specified on the contract.
The default term is used to calculate the total Interest + Principal payable on the loan. If an amortization term is specified, it spreads this total payable amount over the amortization term.
Interest This section defines the interest rate range that can be applied to the contracts for this loan product. It also defines the type of interest for the loan product. Interest Type Select the type of interest applicable for the lending product.
This can be Fixed for the duration of the contract, or Floating that may change as per the lender's business or the banking policies.
Floating Rate Index Select the name of the rate index that defines the different interest rates to apply during the life of the contract, when the interest rate is of type variable. This is applicable for floating interest rate. It defines the interest rates that must apply for different date ranges. For information on setting up the floating rate index, refer to Floating Rate Index.
Floating Rate Change Action Select the floating rate change action that decides whether the payment amount or the contract term must be changed based on the change in the floating rate of interest.
Select To Keep Same Payment Amount Keep the payment amount unchanged. If interest becomes higher, the additional dues generated (interest and principal) are adjusted in the last payment by the borrower. If interest rate reduces, the loan closes earlier than the original tenure. Change Payment Amount The payment amount is changed, keeping the tenure of the loan constant. the payment schedule is regenerated in this case. Interest Rate Change Method
Select the method that decides whether the payment schedules must be regenerated by changing the amount or the contract term, when the floating rate of interest is changed for the contract.
Select To None Change the interest rate for the loan contract without generating a new schedule. Keep Same Payment Amount Change the interest rate and generate a new schedule keeping the payment amount unchanged. If current interest rate is higher, the additional dues generated (interest and principal) are adjusted in the last payment by the borrower. If interest rate reduces, the loan closes earlier than the original tenure.
Delinquency status and old bills remain as are. New schedule includes the old schedule till rate change transaction date and the new schedule with changed term and maturity date from the next payment cycle.
Change Payment Amount Change the interest rate and generate a new schedule keeping the maturity date the same as before.
Delinquency status and old bills remain as are. New schedule includes the old schedule till the rate change transaction date, and the new schedule with changed payment amount from the next payment cycle.
Rate change with new schedule schedule generation is effective only when:
- An active amortization schedule for the loan contract is available. Else, the interest rate is changed without a new schedule being generated, irrespective of the value of this field.
- Financial calculator version is 3.0 or above.
- Repayment Procedure is Equated Principal.
Margin Rate Specify the number or rate that is added to the Index rate, to derive the final floating rate of interest.
Min Interest Rate Specify the minimum fixed interest rate that can be charged to a contract for this lending product.
This is a mandatory field.
Default Interest Rate Specify the default fixed interest rate to be applied to a contract for this loan product. You can override this value at the time of contract creation to a value that lies between the minimum and maximum interest rates defined for this lending product.
This is a mandatory field.
Max Interest Rate Specify the maximum fixed rate of interest that can be charged on contracts for this lending product.
This is a mandatory field.
Protect This section identifies whether the Protect feature is available to borrowers and investors for contracts based on this lending product. Protect Enabled Select this checkbox to allow creation of contracts with Protect feature.
If selected, indicates if loans for this lending product offer protection in the form of loan waiver to borrowers in case of their inability to pay back.
Protect Type Select whether Full or Partial protection can be claimed by borrowers. Schedule Parameters Repayment Procedure Select the procedure followed to create the repayment schedule. The options include:
- Equal Monthly Installments - The installment amount remains constant each month.
- Flexible - The installment amount changes each month.
- Equated Principal - The principal amount remains constant each month.Equated principal installment loan divides the principal into equal parts over the loan tenure. The interest is calculated based on the principal outstanding, and over the life cycle of the loan, both the installment amount and the interest amount decreases.
Excess Threshold % for Reschedule
Optionally, specify the Excess Threshold % for Reschedule as the minimum percentage of principal remaining, which if received as excess, must trigger an automatic reschedule of the contract.
it is the percentage of principal remaining that must be received as excess payment to trigger an automatic reschedule of the loan.
A null value value indicates that a reschedule must not happen, and CL Loan adopts the default behaviour for applying excess payments to the dues.
A "0" value indicates that a reschedule always happens on excess payment, as long as a reschedule option is specified either at the product or the contract level.
Reschedule Option on Excess Payment If you have specified the excess threshold % for reschedule, select the Reschedule Option on Excess Payment to indicate how the contract must be rescheduled. You can either Change the Payment Amount and keep the tenure same, or Keep Same Payment Amount and change the tenure of the contract. If Excess Threshold % is zero, reschedule of loan occurs only if a reschedule option is selected.
It is a method for rescheduling a loan triggered by excess payment. This can be:
Change Payment Amount - keeps loan tenure same but changes the payment amount.
Keep Same Payment Amount - keeps payment amount same but changes the loan tenure.
Funding Options This section defines how the approved loan amount is disbursed to a borrower. You can also specify the repayment terms for both disbursal types here. Funding in Tranches A borrower may request a full disbursal of loan amount, or partial disbursal spread over a duration, which is called the draw period. The latter option is called funding a loan in tranches. In this funding option, the lender can provide multiple options for loan repayment to the borrower. For example, borrower may not be required to make any payment, or required to pay only the interest accrued on the funds drawn, during the draw period. The payment schedule is accordingly generated.
Select this to enable the loan amount to be funded in tranches or parts. This setting cannot be changed at the contract level. There is no maximum limit for a tranche amount. You may disburse the entire loan amount as a single tranche for a loan that is funded in tranches. In such a case, though the amount is fully disbursed, the contract follow FIT behavior.
If this checkbox is not selected, the full loan amount is disbursed in one go.
Note:This is a mandatory field and it must be selected for a Master Facility type of product.
Revolving Select the Revolving checkbox to make the loan revolving. Draw Billing Method If you have selected Funding in Tranches, select this for generating dues during the draw period.
It indicates how the bills must be generated during the draw period of a loan funded in tranches.
Select If None No dues are generated during the draw period. Interest Only The interest accrued on the total amount disbursed till date is billed during the draw period. Repayment Start Basis If you have selected Funding in Tranches, select the required Repayment Start Basis. This option is enabled only when you select Funding in Tranches. This can be Full Disbursal or Draw Period End.
It defines when the borrower starts repaying the loan.
Select If Full Disbursal On full disbursal of the loan amount, the system creates the principal plus interest payments starting from the upcoming due date. If the first disbursal is a full disbursal, then system generate the Repayment Schedule with regular principal plus interest repayments from the upcoming due date. Draw Period End The system generates the Repayment Schedule with interest only payments till the draw period end date, and regular principal plus interest payments after the draw period end. Draw Period End basis is considered only if the draw billing method is Interest Only. If draw billing is none, and if first disbursal , till the draw period end, no dues are generated. Funding Stop Basis If you have selected Funding in Tranches, select the required Funding Stop Basis. This option is enabled only when you select Funding in Tranches.
Specifies the timeline beyond which the loan cannot be funded.
Select If Draw Period End Date The loan cannot be funded after the draw period end date. Grace and Tolerance This section defines the grace days beyond the payment due date within which a borrower can make the payment, without moving the loan contract to delinquent status. You can also specify the loan amount balance that you are willing to ignore while writing off loans that are long overdue or delinquent. Late Charge Grace days Specify the number of days the system waits before charging the penalty on any payment that is over due. If the borrower makes a payment within these days after the payment due date is crossed, late charge is not applied.
Delinquency Grace days Specify the Delinquency Grace days. If the borrower makes a payment within these days after the payment due date is crossed, the loan is not marked delinquent. The late charge is, however, applied to such payment as per the late fee setup, for the days beyond the late charge grace days specified in the step above.
It is the number of days the system waits before categorizing the account as a delinquent account if payment is not received. Late charge, however, is applied for the days beyond the Late Charge Grace Days in such a case.
Usually, delinquency grace days are equal to or more than the late charge grace days.
Write off Tolerance Amount Specify the maximum amount that the system can allow to remain unpaid while writing off a delinquent loan. Delinquency Delinquency Aging Set If you have upgraded to or installed CL Loan 2.3007 or later, specify the Delinquency Aging Set to be associated with the lending product. The Default Delinquency Set available for your selection includes the default delinquency intervals provided by CL Loan. If no value is provided, the default delinquency set of CL Loan is considered.
The delinquency aging intervals to calculate aging for the loan contracts. If no value is provided, the system considers the default delinquency set. In CL Loan 2.3007 and later, you can define custom aging intervals and group them into delinquency sets. For information on adding this field to the layout, refer to section Modifying the Page Layout.
For more information on delinquency sets, refer to section Delinquency Aging.
Loss Provisioning Set Select the Loss Provisioning Set. Accounting This section defines the general ledger accounts used to allocate the funds. Product Asset Account This account is used to track the lender's cash. At the time of funding, funds are disbursed from this account, and at the time of payment, funds are credited to this account.
Type: Asset
Product Excess Account This account is used to track payments made by the borrower that are excess and may be refunded.
Type: Liability or Expense
Product Fee Expense Account Deprecated Product GL Code - Interest Deprecated Product GL Code - Principal Deprecated Product Interest Expense Account Deprecated Product Interest Income Account This account is used to track the interest income on this loan. This account is credited daily with the interest accrued on the loan using true accrual based accounting.
Type: Income
Product Interest Receivable Account This account is used to track the interest receivable on the loan. This account is debited daily by the interest accrued on the loan and credited when a loan payment is made.
Type: Asset
Product Int On Overdue Income Acc Deprecated Product Loan Control Account This account is used to track any receivable on the loan that is not interest or fee, such as, principal receivable on the loan.
Type: Asset
Product Loan Loss Provision Account This account is used to track the loan loss provision. The principal receivable is debited to this account on a monthly basis at time of provisioning
Type: Liability or Expense
Product Loan Loss Reserve Account This account is used to track loan loss reserves. The principal receivable is debited from this account at the time of loan charge-off. The principal receivable is credited to this account on a monthly basis at time of provisioning. Product Loan Purchase Payable Account This account is used to track the payable on the loan for the buyback process.
Type: Liability or Expense
Product Loan Purchase Receivable Account This account is used to track the receivable on the loan for the buyback process.
Type: Asset
Product Write-Off Recovery Account This account is used to track recoveries on the loan after write-off. The principal component of a write-off recovery payment is credited to this account.
A write-off recovery payment is made for a written-off loan.
Type: Income
Product Overdue Interest Account Deprecated
Product Service Fee Income Account This account is used to track service fees on the interest of the loan. This is typically used in the loan buyback process.
Type: Income
Product Suspended Interest Account Deprecated. Product Suspended Int On Overdue Acc Deprecated. -
Click Save.
A Master Facility Lending Product is created.