Example Condition Table: Installment Loan
The following is a general note about conditions and is a typical example of conditions tables for installment loans.
Each condition table for an installment loan must take one bill condition into consideration, regardless of the selected product, because the system controls payments for installment loans using this bill condition.
Additionally, credit bureau conditions are necessary in the USA, to control the messages for the financial authorities.
Fixed Rate Installment Loans
A standard condition is to be set for the product
Fixed Rate Installment Loan (FRIL).
The standard condition is to be valid from 01/01/2005 and is valid for an unlimited period of time. The payment installment is to be a set amount, of which the system calculates 4.5% for interest. The system settles the remainder of the payment installment as a repayment of loan contract capital.
Do not specify amounts or percentages for the bill condition or the credit bureau condition.
The system levies fees for certain business operations.
The processing charge is to be lower for region
01
of the country
US
than that of all other regions of the country
US
, where the higher processing charge is levied (no entry in
Region
field). The charge with the highest amount is to be valid in all other countries (no entries in the
Country
and
Region
fields). Country- and region-specific settings such as these can be made for all conditions and flows.
Description |
FRIL |
Currency |
USD |
Version |
0001 |
Valid from |
01/01/2005 |
Valid to |
12/31/9999 |
Condition |
CTyp |
FType |
Amount |
Percentage Rate |
Reference Interest Rate |
Ctr |
Region |
Payment |
101 |
500 |
|||||
Interest |
108 |
4.5 |
|||||
Billing |
116 |
||||||
Credit Bureau |
118 |
||||||
Prepayment Penalty |
3136 |
5 |
|||||
Charge |
113 |
10 |
US |
01 |
|||
Charge |
113 |
18 |
US |
||||
Charge |
113 |
22 |
|||||
Dunning Charge |
3155 |
0.2 |
You can stagger amounts or percentages for conditions by specifying an effective from date as a date or a period number. In the following example the system is calculating interest of 4.5%. From the 12 th period (after one year for a monthly frequency) the system calculates 5% interest, and from the 24th period (after two years for a monthly frequency) the system calculates 5.2% interest.
Condition |
CTyp |
Percentage Rate |
Effective from (Per) |
Interest |
108 |
4.5 |
|
Interest |
108 |
5.0 |
12 |
Interest |
108 |
5.2 |
24 |
Variable Rate Balloon Loan
A standard condition is to be set for the product
Variable Rate Balloon Loan (VRBL)
. It is to be valid from 01/01/2005 and is valid for an unlimited period of time. Enter the amount of the balloon for this product. The fields
Amount
and
Percentage Rate
do not contain any entries, because the system calculates the amount of payment installments from the installments, in the prior periods, and interest.
You must consider two conditions for the variable interest rate.
In the condition
Interest Calculated
you specify the reference interest rate, EURIBOR for example, and the percentage rate that the system adds to (for the plus sign +) or subtracts from (for the minus sign -) this reference interest rate.You can ensure that the interest rate remains within a certain range of the reference interest rate by specifing caps and floors for a period.
The condition
Interest Rate Adjustment
defines the dates of the interest rate adjustments and is not permitted to contain additional entries.Condition Table
Description
VRBL
Currency
USD
Version |
0001 |
Valid from |
01/01/2005 |
Valid to |
12/31/9999 |
Condition |
CTyp |
Amount |
Percentage Rate |
Reference Interest Rate |
+/- Sign |
Payment |
101 |
500 |
|||
Final Installment (Balloon) |
102 |
5000 |
|||
Interest |
108 |
1.2 |
EURIBOR |
+ |
|
Interest Adjustment |
109 |
||||
Billing |
116 |
||||
Credit Bureau |
118 |
Adjustable Rate Installment Loan
For the product
Adjustable Rate Installment Loan (ARIL)
you need to consider the condition
Payment Interest Adjustment
without entering an amount or interest rate. When adjusting the interest rate the system adjusts the payment installments automatically, so that the loan is repaid fully by the end of term.
Description |
ARIL |
Currency |
USD |
Version |
0001 |
Valid from |
01/01/2005 |
Valid to |
12/31/9999 |
Condition |
CTyp |
Amount |
Percentage Rate |
Reference Interest Rate |
+/- Sign |
Adjustable Rate |
106 |
||||
Interest |
108 |
1.2 |
EURIBOR |
+ |
|
Interest Adjustment |
109 |
||||
Billing |
116 |
||||
Credit Bureau |
118 |
Variable Single Payment Installment Loan
No payments are due during the term for the product
Variable Single Payment Installment Loan (VSPIL)
. The system calculates the final installment from the commitment capital and the variable interest at the end of term. Therefore you are not permitted to enter an amount or percentage rate for the final installment.
Description |
VSPIL |
Currency |
USD |
Version |
0001 |
Valid from |
01/01/2005 |
Valid to |
12/31/9999 |
Condition |
CTyp |
Amount |
Percentage Rate |
Reference Interest Rate |
+/- Sign |
Final Installment |
102 |
||||
Interest |
108 |
1.2 |
EURIBOR |
+ |
|
Interest Adjustment |
109 |
||||
Charge |
113 |
0.8 |
|||
Billing |
116 |
||||
Credit Bureau |
118 |
Interest Only Installment Loan
For the product
Interest Only Installment Loan (IOIL)
the borrower regularly makes interest payment without making repayment payments. The final installment is equal to the commitment capital, and you are therefore not permitted to specify an amount or percentage rate for the final installment.
Description |
IOIL |
Currency |
USD |
Version |
0001 |
Valid from |
01/01/2005 |
Valid to |
12/31/9999 |
Condition |
CTyp |
Amount |
Percentage Rate |
Reference Interest Rate |
+/- Sign |
Final Installment |
102 |
||||
Interest |
108 |
1.2 |
EURIBOR |
+ |
|
Charge |
113 |
0.5 |
|||
Billing |
116 |
||||
Credit Bureau |
118 |