Loan Payment - Payoff Loan

The Payoff Loan option represents the final pay-in of a loan and will be marked as paid off, where no more payments will be allowed. The Loan Wizard will set all of the amounts due in each payment category to zero when you pay off a loan - unless there are outstanding values that are manually set to be unsettled. There is no ability to 'writeoff' unpaid amounts at this time. 

If the payoff amount recorded is more than the amount calculated by the payment wizard and/or the payoff calculator, you must apply that additional amount to any payment category other than Principal.  The principal must always be set to zero when you pay off a loan.  When you apply the additional payment to the interest or late fee categories, the system will adjust the balance due to equal the amount applied and then set the final balance to zero.   

If the payoff amount recorded is less than the amount calculated by the payment wizard and/or the payoff calculator, you must apply that deficit amount to any payment category other than Principal.  The principal must always be set to zero when you pay off a loan.  When you apply the deficit to the interest or late fee categories, the system will adjust the balance to equal the amount applied and then set the final balance to zero.

 Note: Accepting a final payoff amount that is more or less than the actual payoff amount by adjusting the interest rate may affect the overall interest rate calculation for your loan.

The “Applied” column on this page allows you to adjust the values that you are applying to each category.  The total for the “Applied” column must equal the Amount Paid.  If the Amount Paid and Total Applied are not equal, you will see a value in the “Assignment Balance” Field and a message will be shown below the table.  The Assignment Balance must be equal to zero (0) before the system will let you finish recording the payment.

The “Balance” column will show you the amount of underpayment or overpayment there will be for each category. 

To accept the payoff, Click the “Finish” button.  Once you click the “Finish” button, the payoff will be applied to your loan and your loan will be considered as “paid off”, meaning no more payments can be applied to that loan.

Return to Borrower
This category was created to separate a possible overpayment by the borrower, which is expected to be returned and will be properly accounted for in the Register.

Secondary Payer

If your company accepts payments split by a secondary borrower or payer, then this option will allow you to segment a secondary payer's amount, which is differentiated from the loan's primary borrower payment amount.
Note: This option only works if you do not have the investments module and do not have the NACHA module.

When clicking the 'Payoff Loan' option, and then entering your payment date and amount, the screen after will be as shown below. You'll see a '(Add Secondary Payer)' link to start the process of identifying the secondary payer and their amount.

You will select the secondary payer (contact from within your contacts list) and set the amount paid.
Upon clicking 'Save' there, you'll be taken back to the Payoff Assignment page with the secondary payer's amount identified.
Note: On this page, you'll see an (X) link to remove the added secondary payer if you'd like.
Once you click 'Finish' to record the payoff, you'll be redirected to the loan's schedule. The schedule will show an unscheduled payment for the secondary payer followed by the pay period's payment reflecting the primary borrower's payoff amount.

The schedule will look off, but by reviewing the register, you'll see the secondary payer also paid a portion of the interest.