Loans > Loan Screens > Account Information Screen Group > Account Detail Screen > Late/NSF tab

The following fields are found in the Penalty Information field group on the Late/NSF tab of the Account Detail screen.

These fields are used to designate the penalty rate of interest for special loan offers on the customer account. For example, a customer account has received a special loan offer for 90 days at 1.5%. If 90 days have passed and the loan is not paid off, the penalty rate designated in these fields comes into effect.

laiad_penaltyinfofg

The fields in this field group are as follows:

Field

Description

Penalty Days

Mnemonic: LNLPEF

This field displays the number of days after the due date that interest is charged on the balance of the loan at the penalty rate. This field is usually set up with Loan Patterns and assigned at loan origination. However, if you have proper security clearance, you can change this field.

Penalty Rate

Mnemonic: LNLPRT

This field contains a rate that is used to accrue the loan at a “penalty rate” during the period in which the customer’s payment is past due. The loan will use this rate until it is brought current. This field is usually set up with Loan Patterns and assigned at loan origination. However, if you have proper security clearance, you can change this field.

	Note: You must also check the Use Penalty Rate field below before the penalty rate can be applied to this loan.

Use Penalty Rate

Mnemonic: LNUSPN

If this field is checked, the system will use the penalty rate if the loan becomes delinquent according to the Penalty Days field above. If it is not checked, the penalty rate entered in the Penalty Rate field above will not be used. See below for more information.

This field is usually set up with Loan Patterns and assigned at loan origination. However, if you have proper security clearance, you can change this field.

The system will not stop penalty interest calculations on loans sold to investors that are still serviced by your institution. If a loan is more delinquent than the number of days in the Penalty Days field above, and the option to use penalty interest is turned on, all loans will accrue at the Penalty Rate (above) rather than the regular rate, even if they are sold to investors. The penalty interest is an option and only works for those loans that have the Use Penalty Rate field checkmarked.

The penalty rate is set at origination and displayed in the Penalty Rate field. Your institution determines how delinquent a loan must be before the penalty rate kicks in (see Penalty Days above). Once the penalty rate is applied, a borrower may need to renegotiate (modify or renew) the loan in order to reduce the penalty rate. Additionally, charged-off loans or loans in bankruptcy may cause the removal of the penalty rate. This is determined by each institution.

	WARNING: If this field is checked and the Penalty Rate and/or Penalty Days are blank, your interest calculations and/or the bill and receipt could be incorrect.