How to Freeze a Loan's Expected Payments

This process was created for individuals who want to 'Freeze' or 'Pause' a loan's expected payment dues for a certain number of pay periods. 

For our example, we will pause the loan's payments for three months. 

We will use the following Modify Loan button options to achieve this guide's outcome:
Interest Rates: https://bryt-product-guide.document360.io/docs/loan-modification-interest-rates
Payment / Amortization: https://bryt-product-guide.document360.io/docs/loan-modification-payment-amortization
Extensions: https://bryt-product-guide.document360.io/docs/loan-modification-extensions

Example Loan: $100,000, Fully Amortized, Monthly 30/360, 12%

Loan's Schedule Before Modifications - 

Changing the Interest Rate

To start, we'll want to go to the loan's Summary and click on the Modify Loan button to select the Interest Rates option.

I've recorded the first payment for our working example, to show it can be done at any point in the loan's life.

With the Interest Rates option, we'll want to change the interest rate to 0% on the first day of the pay period you're seeking to 'freeze'.
Click the 'Add Interest Rate' button and enter an effective date as of the prior pay period's due date (for most loans, since the due date denotes the first day of the following pay period). Then set the Rate to 0% and click the 'Save' button. 

If you go back to the schedule you'll see there's $0 due in interest for the remainder of the loan.

Since our example is seeking to freeze the loan by 3 months, we'll be going back and using the 'Add Interest Rate' button for the loan to start collecting interest again.
The first date we entered was 8/01/2022 and now we'll be entering 11/01/2022 (and setting the Rate to 12%) to have interest collected during that time period (three months).

After setting that 12% interest on 11/01/2022 (reflects interest due for 12/01/2022), you'll now see the schedule display the following:

From here, we'll be changing the Payment / Amortization to reflect $0 due in principal as well, however, you can record $0 payments here and the unpaid principal will remain as principal due at the end of the loan (balloon payment at the 12th pay period, unless an extension of 3 pay periods is applied). 

Changing Payment / Amortization
Note: This step is optional if you'd like to exclude the expected due amount (principal due shown) on the schedule tab.
Using the Modify Loan button, we'll go to the Payment / Amortization option and use the Edit button for the pay periods that we want to change.

For those pay periods we set to collect $0 interest on, we will change them to $0 amounts (Shown below).
You can either apply this to all future pay periods (where you will need to go back and reapply the Amortization option) or go to each pay period individually and select the Fixed Payment option with a $0 payment (recommended for less confusion).
We'll want to leave the 'Apply these settings to future pay periods?' option set to No for this guide and apply the Fixed Payment option with a $0 payment for the three pay periods noted in the previous screenshot.
Once applied, you'll see the following:

The schedule will then reflect the $0 payment changes:

Addressing the Balloon Payment
Since we froze the loan by three pay periods and the number of terms (pay periods) stayed the same, we'll need to apply an extension to the loan, which will add those three months to the end and set a new maturity date. 

Going back to the loan summary and using the Modify Loan button, we'll want to select the 'Extensions' option. From there you'll want to click the 'Add Extension' button. 

There is only one Extension Type at the moment, so we can leave the default 'Simple' option as is. For the 'Number of periods to extend loan?' option, we'll want to enter 3 to make up for the 3 pay periods we paused the loan for. Then click 'Save'.

Now when we go back to the schedule we'll see there is no longer a balloon payment since the last three payments are evenly spread out between the added periods with the extension.