NetLoan - Establish Payment Details

Use Case: By default, NetLoan assumes a monthly payment and carries forward the Initial Monthly Payment to each period throughout the entire loan term. If any variability exists in the timing or amounts of loan payments (including escalating payments or non-monthly payments), that variability needs to be documented and reflected in the Payments sublist on the Amortization Schedule subtab of the loan record.

STEP BY STEP PROCESS

  • During initial lease setup or in edit mode of any existing loan record, indicate the initial monthly payment amount during the month of commencement in the Initial Monthly Payment field within the Schedule Information header section.
  • To edit future payments, navigate to the Payments sublist on the Amortization Schedule subtab      
  • Select the payment type of the loan payment. 
    • Standard: the defined loan payment will first be applied to interest and the remaining amount will reduce the principal. 
    • Principal Adjustment Gain/Loss: the defined loan payment will be applied only to the principal balance of the loan. This will process as a modification entry and will record the offset to the loan liability as a gain/loss. Interest will accumulate rather than be included in the payment. 
    • Defined Principal: the principal balance of the loan will be reduced by the defined amount. The loan payment will vary each period as the payment amount will be the total of the defined principal balance plus the interest. 
    • Principal Adjustment Payment: the defined loan payment will be applied only to the principal balance of the loan. Interest will accumulate rather than be included in the payment. 
    • Pay off Remaining Balance: **Only allowed on a loan modification and not on initial set up** the defined loan payment will be allocated between interest, principal, and gain/loss (if applicable).
  • Select the effective date field of the change in loan payments and input the first date of the period that a payment is due.
  • Input the amount and indicate the frequency of the payment. Each future period entry will override all previous payment inputs
    • One-Time: the payment will be captured for that period, but not in subsequent months, which will default to zero unless another payment is entered
    • Monthly: the amount will carry forward each month with the amount input
    • Bi-Monthly: the amount will be applied every two months starting from the effective date, with zero for the months between payments
    • Quarterly: The amount will be applied every three months starting from the effective date, with zero for the months between payments
    • Semi-Annually: the amount will be applied every six months starting from the effective date, with zero for the months between payments
    • Annually: the amount will be applied every 12 months starting from the effective date, with zero for the months between payments
  • An example payment schedule is shown below:


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