Late charges are accrued in the afterhours following grace days if a payment hasn’t been made. The amount to charge for late charges is determined by your institution and displayed in the Late Charge Rate and Late Code fields below.

Late charges can be waived in GOLDTeller using transaction code 570.

Late charges can be paid directly in GOLDTeller using the Pay Late Charge transaction (tran code 550), or they can be paid through a regular loan payment in the order set up on the Payment Application field on the Loans > Account Information > Account Detail screen, as shown below:

For example, if a loan principal and interest payment due is $100, and a customer pays $120, the payment will first pay the principal and interest amount of $100, and then the other $20 will go to late charges.

If late charges are not part of the regular loan payment, they will remain on the loan until other things (principal, interest) are paid off.

Late charges can be paid directly using the Pay Late Charge transaction (tran code 550), or they can be paid with a normal loan payment. However, the Payment Application field must have the Late Charges box checked. If the Late Charges box is listed first in the Payment Application field, late charges are paid first before any other part of the loan payment (principal, interest, fees, etc).

Your institution determines whether or not late charges are included with loan payments, and in which order they are paid. To reverse a late charge, use tran code 550, but check the Correction box, as shown below:

Make sure you enter the same amounts that were entered on the original Late Charges transaction. (Late charges can also be reversed with a payment reversal. The system reverses the payment in the same order as set up in the Payment Application field.)

Additionally, you can waive late charges, which are different from reversing late charges.

•Waiving late charges means the account is still delinquent, and the Times Late field is not affected, but you still waive the late charges.

•When you reverse a late charge, the Times Late field also reverses by one.

History records late charges paid as tran code 550 and corrected late charges as 558. If you do correct a late charge, you must also run the Late Charge Reversal G/L transaction (tran code 1800-00-10) to remove those funds from your General Ledger. You must know the General Ledger account number where late charges are stored for your institution.

If Institution Option KLLT is enabled, this field will not be cleared when performing the Judgment transaction (tran code 2510-02) or when the Bankruptcy transaction (only available on the Loans > Bankruptcy screen) is run.

Additional requirements are needed before loans can be automatically charged off (see Automatic Charge-off Setup below). If institution option CODY (Number of Days Delinquent to Charge-Off) is set up, as well as this field, the system uses the number in this field as the date when the system automatically charges off loans and ignores option CODY.

Automatic charge-offs are shown as transaction code 022-01 in Loan History using TORC 63.

When loans are charged-off, the following actions take place on the account:

•Places a General Category of 80, 82, 83, 84, 86-89 (depending on what type of loan it is) on the loan.

•Adds a Hold Code 2 (charge-off) in one of the Hold Code fields (LNHLD1, LNHLD2, LNHLD3, LNHLD4).

•Adds an Action Code 153 (charge-off date)

•Places the current principal balance in the Charged Off Amount field (LNCOBL) (found on the Loans > Account Information > Actions, Holds and Event Letters screen).

•Additional actions may take place on the account according to options set up for your institution. There are many charge-off options, commonly referred to as the COOP options. See COOP option for more information.

Loans with Action Code 77 (stop automatic charge-off) or Hold Code 4 (Bankruptcy Chapter 7 or 11), 5 (Bankruptcy Chapter 13), 7 (Legal hold), and 9 (Legal hold) stop the charge off from processing. Also, loans will not be automatically charged off if they have a sold balance. The account will appear on the Afterhours Processing Exceptions Listing (FPSRP013) with the message "PORTION SOLD MUST BE ZERO."

All loans that are charge off in a daily report called the Charged Off Loans Posting Journal and Trial Balance (FPSRP220).

Automatic Charge-off Setup

In order for the system to automatically charge-off loans, the following items must be set up by your GOLDPoint Systems client solutions specialist:

•Institution option CODY stores the number of days past the loan due date that the charge off will automatically occur.

•Institution option STRN must be set up. This is an option that allows many special transactions to process. (See Appendix A.2, Special Transactions, in the Loan System manual for more information.)

•If your institution uses any of the COOP options, those actions will be applied to the account. See the COOP option description on the Charge-off Transactions screen for more information.

•Update function 86 must be set up for your institution in order for loans to automatically charge-off in the afterhours.

•GOLDPoint Systems financial team must set up your Autopost for TORC 63. Additionally, the afterhours process uses the General Ledger numbers set up in the Write-Off - Regular Loan field on the GOLD Services > General Ledger > GL Account By Loan Type screen.

Enter a rate value in this field. If the Late Code field is set to “15 - Charge a Flat Fee” or "26 - Charge a Flat Fee With Minimum/Maximum," a dollar amount must be entered instead.

If the late charge amount calculated through these fields is greater than or equal to the Principal Balance and Institution Option NOLC is enabled, no late charge will be assessed.

Late charges will not be assessed on accounts with a General Category of 80-89 (foreclosures/repossessions). However, Institution Option LC82 allows late charges to be assessed for accounts with a General Category of 82 (charge off non-real estate property) or 85 (repossessed assets) unless the account has reached maturity. Late charges will not be assessed on accounts with Hold Code 90 (judgment awarded) active.

Institution Option LTBK prevents the assessment of late charges on Chapter 13 bankruptcy accounts (hold code 5).