Payment Distribution:

When a payment is made on a loan, if the user does not manually specify to which balances the payment is to be applied, the system will apply the funds in the order specified in the loan’s Payment Distribution Defaults.

To change the payment distribution order for the template, click on the options (…) button to the right of Payment Distribution, this will open the Payment Distribution dialog.

To change the default distribution order, click on a distribution Item from the list, and use the Up and Down buttons to set the order desired. Clicking the Reset button will set the distribution back to the system default


Distribution Item Definitions:

Past Due Interest
All interest billed and due for which the due date is prior to the current date.
Past Due Principal
All principal billed and due for which the due date is prior to the current date.
Past Due Late Fees
All late fees billed and due for which the due date is prior to the current date.
Past Due Fees
All other fees billed and due for which the due date is prior to the current date.
Current Interest Due
All interest which has been accrued and has been billed, but which is not past due.
Current Principal
All principal which has been billed, but is not past due.
Current Late Fees
All late fees which have been billed, but are not past due.
Current Fees
All other fees which have been billed, but are not past due.
Current Interest Accrued
Any interest which has been accrued but which has not been billed.
Unbilled Principal
All remaining principal on the loan after all of the billed payments and any outstanding interest have been satisfied.
Suspense
If this item is reached, any remaining portion of the payment will go to the suspense account.
Unbilled Late Fees
Any late fees for which there is a late fee balance, but no outstanding receivable.
Unbilled Fees
Any fee for which there is a fee balance, but no outstanding receivable.
Current Interest Through Effective Date
This selection will only be in effect if it is placed above Current Interest Accrued, because that selection will pick up all remaining interest. Current Interest Through Effective Date takes the Current Interest Balance and subtracts any accruals that were posted subsequent to the effective date of the payment.
Past Due User Def #1 – 10
The user defined loan balances which have been billed and for which the due date is prior to the current date.
Current User Def #1 – 10
The user defined loan balances which have been billed, but are not past due.
Unbilled User Def #1 – 10
The user defined loan balances which have not been billed.
Past Due Deferred Interest
Any deferred interest for which there exists an outstanding receivable, and for which the due date of that receivable is past.
Current Due Deferred Interest
Any deferred interest for which there exists an outstanding receivable and for which the due date of that receivable is the present of a future date.
Unbilled Deferred Interest
Any deferred interest for which there is a deferred interest balance, but no outstanding receivable.
P + I Inclusion User Def # 1 - #10
If these are moved above the past or current due interest, then the user defined loan balance will be taken first as part of a P + I payment.
Past Due Impound
The amount of any impounds billed by the Escrow Module, which have a due date in the past.
Current Impound
The amount of any impounds billed by the Escrow Module, which have a due date in the present of future.
Unbilled Impound
Will apply against any monies disbursed from the Impound Account that are in excess of the amount collected, when no impound billing exists. The impound account is a contra account and would have a negative balance in this case.
Apply Excess Principal as Future Payments
If this option is checked, and the distribution reaches the Unbilled Principal level, the system will automatically bill the receivables for the next regularly scheduled payment, and then the distribution will return to the top of the list.
Interest Through Due Date (Zero Balance)
If this option is checked, the system will calculate the amount of interest that was or will be (depending on if the payment is being made early or late) accrued as of the due date, and this is the amount of interest that is applied. If the payment is being made early, the principal portion of the payment will result in less interest being accrued for the remainder of the period, and this could result in negative interest as of the due date. The distribution will be corrected to prevent the negative balance. IE just enough interest and principal will be paid so that the balance will be zero as of the due date.
Interest Through Due Date (Negative Balance)
If this option is checked, the system will calculate the amount of interest that was or will be (depending on if the payment is being made early or late) accrued as of the due date, and this is the amount of interest that is applied. If the payment is being made early, the principal portion of the payment will result in less interest being accrued for the remainder of the period, and this could result in negative interest as of the due date. The borrower will have paid extra interest for the period, and this will result in less interest being charged in the following period.
Disable Suspense Bucket
Checking this box disables suspense. Overpayment on a payoff will still go to suspense, but suspense is ignored in the distribution order.
Disable auto-reversal of Late Fees on effective dated payments
Unless this box is checked, the system will automatically reverse a late fee if a payment is back-dated to a date prior to the expiration of the grace period that caused the late fee to be executed.
Disable auto-application of reversed late fees on NSF and reversed payments
Unless this box is checked, the system will automatically apply a late fee if a payment is reversed after the expiration of the grace period for that payment.
Disable re-application of payments during out of sequence payment reversal.
Unless this box is checked, whenever a payment is reversed which is not the last payment to have been entered, the system will automatically reverse and then reapply all subsequent payments so that they will be applied as they would have been had the reversed payment never been entered.
Oldest Payment First
If this option is checked, it acts as an override on the Past Due Interest / Past Due Principal distribution. When there are multiple payments past due, this override will force payment of principal on the first payment before allowing payment of interest on the second payment. Without the override, all past due interest would be paid before anything was paid to principal.
Cover Late Charges
If this option is checked, the late charges associated with a past due payment will be paid before funds are applied to the next payment.
Cover Fees
If this option is checked, the fess associated with a past due payment will be paid before funds are applied to the next payment.
Cover Impounds
If this option is checked, any billed impounds which have a due date that is the earliest due date of any other outstanding receivables will be covered before any later receivables. This acts as an override to the distribution order.