Amortized Fee Setup

Some of the parameters for amortized fees can be pre-defined and saved as templates in Setup > Loan Setup > Amortized Fees. The templates can then be selected when setting up an amortized fee on a loan and the configured parameters will be filled in accordingly. The description of the fields can be found in their respective amortization type sections below.

Straight Line - Periodic
Straight Line - Custom
Effective Interest Method
Effective Interest Method - Daily Accrual
Principal/Original Balance Pro-rata Method
Rule of 78
Average of Rule of 78 and Straight Line
Actuarial

Click … next to Start Date to configure the start date that will be filled in for the amortized fee when the template is selected.

Type Defines the method by which the date is determined.
Not Applicable

Leaves the date field blank allowing for manual configuration of the date.

Relative from Origination Date

The start date is determined by the Period and # of Periods based on the origination date of the loan.

Relative from Current Date

The start date is determined by the Period and # of Periods based on the current date.

Day Value Forces the date to a specific day of the month.
N/A (or value of 0)

Sets the date as defined by Period and # of Periods.

Force Negative

Rolls back the specified number of days.

Force Positive

Jumps forward the specified number of days.

Force Neutral

Sets the date to the specified day of the month.

Date This field is not applicable and is disabled.

Configuring Amortized Fee on a Loan

To set up an amortized fee on a loan, query the loan, then select ViewAmortized Fees menuclick the Loan tab of the ribbon bar and select  Amortized Fees in the Setup group.


Click AddAdd.

Select <MANUAL> from the Template drop down list to start with a clean slate or select a pre-defined template to work with. The specific configuration will depend on the type of fee amortization:










Cancellation Tab

Available in NLS 4.9.2 and later.

Options and rules to be applied when an amortized fee is canceled is configured in this tab.
Actuarial / Pro-RataRule of 78Conditional Pro-Rata
Type Calculation used to determine the amortization adjustment and cancellation amounts.
Actuarial

Entire amortization amount is used as the cancellation amount.

NLS 5.20 and later

Straight Line Periodic

Remainder of the amortized fee is canceled while the pro-rata rate of the amortization fee is reversed. Rebate rule is applicable.

Straight Line Custom

The unamortized balance is canceled.

Effective Interest Method

The unamortized balance is canceled.

Effective Interest Method - Daily Accrual

The ratio of earned interest to anticipated life interest is canceled. Rebate rule is applicable.

Principal/Original Balance ProRata Method

The unamortized balance is canceled.

Rule of 78

Remainder of the amortized fee is canceled. Rebate rule is applicable.

Average of Rule of 78 and Straight Line

The ratio of earned interest to anticipated life interest is canceled. Rebate rule is applicable.

Pro-Rata

Remainder of the amortized fee is canceled while the pro-rata rate of the amortization fee is reversed.

Rule of 78’s

Remainder of the amortization fee is reversed.

Conditional Pro-Rata5.16+

Same as Pro-Rata with the ability to define the number of days from origination.

Cancellation Transcode Transaction code to use with the cancellation.
Minimum Cancellation Sets the minimum amount required for the cancellation amount. Cancellation amount is 0 if it is less than the minimum cancellation value. Maximum value is 999.00.
Minimum Amortized Fee5.18+
The minimum amount that may be assessed on the loan.

Example

If the closing fee of a loan is $30 and the loan is paid off before maturity, setting this to $25 will still asses $25 fee on the loan.
Cancel on Early Payoff When selected, the entire amortized fee is removed when the loan is paid off early.
Refund Setup Expire Date5.18+
No refund of amortized fees is issued on or after the specified date.

Example

If the closing fee can only be refunded within the first 90 days and the lender is allowed to keep the full amount after 90 days, advance this date 90 days from the origination date.
Complete Refund Expire Date5.20+
A full refund of amortized fees is issued on or before the specified date.
Rebate Rule Rules for rebate determination.
Through End of Period

Payment must be made before the end of the period minus the specified Cutoff Days for the rebate to be applied.

Through End of Period from Origination Date5.28+

Refund is calculated from the origination date.

Proportional

Rebate is proportionally applied.

Nearest Payment Date

If a payment falls within the first half of the month, rebate is applied.

Rebate Factor Percentage5.15+
Only applicable to type Pro-Rata. The percentage of the refund amount (unamortized fee) portion to be included in the total cancellation amount.
Cancellation Computation5.16+ Only applicable to type Conditional Pro-Rata.
Origination Date to Maturity Date

Default. Refund is computed based on the number of days from the origination date to maturity date.

Custom

Enter the maximum number of Days from Origination Date.