LOAN ADD-ON/ADVANCE

 

 

This procedure adds funds to an existing loan.  It can be used when issuing a new loan with more than one check, or to add to a line of credit loan at a later date.

 

AT EACH INPUT POINT IN THIS PROGRAM A HELP WINDOW HAS BEEN PROVIDED WHICH EXPLAINS WHAT IS NEEDED IN THAT FIELD.  BY PRESSING 'F8' THE HELP WINDOW WILL DISPLAY THE HELP WINDOW FOR THE FIELD THE CURSOR IS IN.   YOU CAN USE THE DOWN ARROW TO DISPLAY ADDITIONAL INFORMATION.

 

1.                  Access the member's account in Program #2

 

2.                  Press 'HOME' to lock in the account, and use the up arrow to highlight 'New-Loans/Advances'.  Press 'HOME' or 'ENTER' to choose this type of transaction.

 

 

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3.                  Enter the 'LOAN NOTE NUMBER' to which you wish to add an advance.

 

4.                  Enter the 'LOAN TYPE'     This field will be supplied for you.   Press 'ENTER' to move to the next field.

 

5.                  The 'Display PRIOR-LOAN-BALANCE' field will indicate the current principal balance of the loan.

The 'PRIOR-REFINANCED-AMOUNT' will be N/A because this is NOT a refinanced loan.

 

6.                  'Enter ACCRUED-INTEREST-ADDON' - The system automatically enters the interest due since the last payment in this field.  If you leave it as it is, the interest will be taken as income, and added to the principal balance of the loan. 

 

If you do not wish to add the interest to the loan, but collect it when the next payment is due, change this field to $0.00.  It will automatically be entered in the 'UNPAID LOAN INTEREST' field in Program #4

 

7.                  If you are entering a new loan, the cursor will automatically advance to the 'INSURANCE CODE/PREMIUM' field. 

1)                  If there is no insurance on this loan, press 'ENTER' and the default will be $0.00

2)                  If insurance is added to the loan which has a one time premium, enter the total amount of that premium in this field

3)                  If you use monthly add-on insurance, enter the appropriate code for the type of insurance this member is purchasing.  (Press 'F8' for an explanation of the available codes)

 

8.                  'Enter APR (##.###)' If the default rate is not correct for this loan, enter the correct rate.  (Can be up to 3 decimal places)

 

9.                  'Enter FIRST PAYMENT DUE DATE' This field will default to the date the next payment was due on this loan.  You can leave it as is, or change it to the date the next payment will be due.

 

10.              'Enter PAYMENT FREQUENCY'   This field defaults automatically to 'M'.  If the payment frequency is other than monthly, enter the proper frequency code.  (Press 'F8' for a list of the available codes)

 

11.              'Enter COLLATERAL CODES'    In this field you can enter up to 4 separate collateral codes.  These codes can be used to sort loan balances and statistics.  Loans and their income are sorted on Month-End reports by the code in the first position.  ( Press 'F8' for a list of those codes) The remaining codes can be used for any purpose you choose.

 

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12.              Choose one of the next 3 fields to enter the amount to be advanced to this member:

 

1)                  'Enter NEW LOAN FUNDS (CHECK)' is used if a check will be issued for the funds to be advanced

2)                  'Enter NEW LOAN MONEY (CASH)' is used if the funds for this loan are to be disbursed as cash from a teller drawer to the member.

3)                  'Enter NEW LOAN TRANSFER AMOUNT' if the funds are to be deposited directly into an account on the system. 

If you choose this option, the cursor will stop at the next field for you to enter the 'TRANSFER TO SHARE TYPE'. 

 

If you are transferring the funds to a share type on the same account number, enter the share type designation into which these funds should be transferred. 

 

If the funds are to be transferred to another account number, enter 'N' in this field, and do a separate 'Deposit Transfer' transaction to shares after the loan is entered.

 

13.              'Enter NEW LOAN BALANCE' - The balance after the new funds are advanced will appear in this field. 

 

14.              'Enter MINIMUM REQUIRED PAYMENT' - If you know the amount of the required loan payment (per the contract) enter it in this field and the 'NUMBER OF PAYMENTS' will automatically be calculated.

 

If you know the 'NUMBER OF PAYMENTS' but not the payment amount enter '0' in this field.

 

15.              If you entered the 'MINIMUM REQUIRED PAYMENT' the system will have calculated this field for you.

 

If you entered 0 for the 'MINIMUM REQUIRED PAYMENT' enter the 'NUMBER OF PAYMENTS' here and the system will calculate the payment amount.

 

16.              'Enter DESIRED LOAN PAYMENT' - This field will default to the amount of the 'MINIMUM REQUIRED PAYMENT'.  If the member chooses to pay an amount in excess of the 'MINIMUM REQUIRED PAYMENT', that amount can be entered in this field.  This amount will be displayed on Program #2.  (Delinquency is computed using the 'MINIMUM REQUIRED PAYMENT' amount.)

 

17.              'Enter PERMANENT LOAN FLAG' (Y/N) - Enter 'Y' if this loan is permanent and should not be purged from the system even when the balance is zero.  (This is typically only used for Line of Credit loans.) 

 

18.              'Enter UNSECURED (SIGNATURE) LIMIT' - This field is used for approved lines of credit.  By entering the approved limit in this field, it will automatically be displayed any time an add/on or advance is done on this note number.  This enables you to know how much credit is available without leaving Program #2.  This field is also used for Month-End reporting of Available and Used lines of credit.

 

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19.              'Est TOTAL FINANCE CHARGE'

'Est TOTAL INSURANCE COST'

'Est TOTAL OF PAYMENTS'

The above fields will all be calculated for you.  These are estimated figures based upon the assumption each payment is made on the exact due date for the exact payment amount.

 

20.              'Enter SHARE TO LOAN TRANSFER' - In this field enter the method of payment.  (Press 'F8' for a list of acceptable payment methods.)

 

21.              'Enter START AUTOMATIC TRANSFERS.' - This field indicates the date the first automatic transfer (via Share to Loan Transfer) or direct payment via ACH or Payroll split should be done.  The system defaults to the First Payment Due Date, but you may want to change it based upon payroll or ACH date.

 

22.              'Enter DELINQUENCY METHOD'  (O/N) - Typically this field is 'O' unless the loan is Real Estate with a maturity of more than 15 years.

 

23.              'Enter LOAN OFFICER CODE' - If your credit union wants to track loans by Loan Officer enter the appropriate alphabetical code in this field.  (Can be up to 3 characters)

 

24.              'CREDIT BUREAU LOAN TYPE' - This field is used if you wish to override the system default when reporting to the credit bureau.  (Press 'F8' for a list of the default codes, and the options available for changing them.)

 

25.              'MISSING TITLE' - Enter in this field the number of titles that are required for this loan, and not yet in the loan file.

 

26.              'MISSING INSURANCE' - This field is used to indicate that some type of action needs to be taken on collateral insurance for this loan.  The credit union can establish any numbering system it chooses for this field.  (Press 'F8' for more information.)

 

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27.              This page displays estimated projections on the loan as follows:

 

DAILY INTEREST CHARGE

UNPAID INTEREST OWED

ORIGINAL MONTHS MATURITY

TOTAL DISABILITY INSURANCE

TOTAL LIFE INSURANCE COST

TOTAL ADD-ON INSURANCE

DISABILITY RATE

LIFE RATE

 

If this is a 30 day interest type real estate loan (Determined by an 'R' in the payment frequency field) you will need to input the following information:

1)                  'Real Estate mortgage ESCROW amount' - Enter in this field the amount of ESCROW which should be added to the loan payment amount.

2)                  'Real Estate mortgage GRACE days' - Enter in this field the number of days allowed before a late payment fee is charged.

3)                  'Real Estate LATE-PAYMENT penalty RATE' - Enter in this field the loan late payment rate.  This must be a percentage of the payment amount.

 

28.              'Press 'F11' for VOUCHER! - ESC to abort!' - If the information is correct, and you want to enter this loan, press the 'F11' key.  If the information is not correct, press 'ESC' and you will be returned to the transaction menu, and all information you have entered on this loan will be erased.

 

29.              If you press the 'F11' key, the voucher will be displayed showing the amount of the loan, and the method used to disburse this loan to the member.  If the information is correct, enter your teller password to post the transaction.

 

     IF THE LOAN IS TO BE DISBURSED CASH OR TRANSFER TO SHARES, PRESS 'F9' AT THIS POINT TO PRINT AND CLOSE THE VOUCHER.

 

30.              If you chose to disburse this loan by check, the check form will automatically be displayed.  Use the 'ENTER' key to move to the following fields on the check:

'Check-Group' - This field will be used in the check register.  Designate the check group

        code you will use for these checks.  (Your credit union will determine the codes to be

        used A-Z)

'Check Number' - Enter in this field the check number you are issuing.  This field will be  

        displayed in the check register.

'Pay To The Order Of' - This field will default to the name of the primary member on this

         account.  You can leave the name as it is, add to it by typing in the additional information,

        or press the 'HOME' key to clear this field, and enter a new payee.

'Memo' - This field can be used for any information you choose, or can be left blank.  This field will also be displayed in the check register.

 

31.              Load a check into the printer and press the 'F10' key to print the check.  If you choose not to print the check, press 'ESC'.  (The information you input on the check display on the screen will appear in the check register even if you choose not to actually print the check.  After printing the check press 'ESC' to return to the voucher. 

 

NOTE: If you need to reprint the check after you have completed this step, you must use Program #71 reprint routines.  (You will need to know the sequence number for this item.)

 

32.              'Press 'F9' to PRINT voucher.  'F4' CLEARS voucher; 'ESC' to CONTINUE!' - This voucher can be printed on the bottom of the check form, or as a separate voucher.  If you have other transactions to do for this member, you can press 'ESC' at this point and complete other transactions for the member BEFORE printing the voucher.