loan amortization schedules

[Guest]

here is an interesting issue I have encountered. If a participant has made extra loan payments, then the amortization schedule 'adjusts' his loan payments to correspond to the number of months remaining.

NOTE: this does not appear to change the regular payments, it is simply the amortization schedule that prints this way.

in other words, if I want to print a revised amortization schedule on an individual, I have to model it, set the loan payment amount to the original payment amount and then print the schedule.

In fact, as with all loans, the last payment is usually slightly different than all the other payments. As a result, the loan payment amount might end up differnt on your amortization schedule regardless if extra payments were made. I have encountered some varying a few pennies.

AGAIN, I would emphasize, this is only the amort schedule. the system does not appear to be using these adjusted amounts.

If you don't 'model' before printing, you might not even be aware the system is doing this.

[Guest JohnB10]

Speaking with an example, let's suppose the periodic loan payment is $150, and the participant makes an extra payment of $300. We apply the $300 as a payment adjustment to principal to the last posted loan payment transaction. Are you saying that, when we print the amort for this particular loan, the remaining periodic payments that are due don't individually equal $150 (let's disregard the last payment due for now)? If that's the case, I think it's a program bug. Thanks for pointing this out. You're one of the brave individuals on QT 5.0, right Tom? Have you applied Service Pack 8 yet?

[Guest]

(yes, I have run svc pack 8)

my apologies, I should have used an example.

original loan = 2000

12 payments (1 year loan)at 10%

so monthly payment = 175.83 (if my calculator is working correctly)

ee pays extra the first month and loan is now 1800.

if you print the amort schedule, it will indicate 11 pmts remaining, and the payment will now be 171.93!

If you run a loan payment on the system, the system will use 175.83. Thats the good news.

it is just the amortization schedule that is messed up.

at least that is what is happening on my system. so, before printing a schedule, I have to model and reset the loan payment.

I just had a plan that is terminating, so I needed to print schedules on a number of people, so I was 'thrilled' to say the least to go into each loan and do this!