Navigation:  Loan Screens > Account Information Screen Group > ARM Information Screen > ARM Detail tab > Rate Information field group > Round Rate

Entry: User, 2 drop-down lists

F/M: Yes

Mnemonic: LNRRND, LNRRTQ, LNNRRS, and LNRR10; LNRDUP and LNRDDN

Screen: Loans > Account Information > ARM Information > ARM Detail tab

 

Two fields control how rates are rounded each time a new rate is calculated. The first drop-down list determines if the rate is rounded up, down, or to the nearest rate. The second drop-down list determines what decimal the rate should be rounded to.

 

Up, Down, Nearest Field

Using this field will round the following rates:

 

 

 

The default value is “Nearest.”

 

If you select “Up,” the system will round up to the nearest 10th or 8th depending on what is in the first Round Rate field. An example of rounding up would be if the interest rate calculated is not an even 1/8th or 1/10th, the system will increase the interest rate until it is an even 1/8th or 1/10th. (That is, the interest rate may be 8.32, but in order to round to 1/10th the system must add .08 to round the rate to 8.40.)

 

“Down” will round down to the next possible 1/8th or 1/10th parameter. It would push 8.32 down to 8.3. Even if the rate calculated had been 8.39, the system would still round the rate down to 8.30.

 

“Nearest” uses established rounding rules: if less than 5, round down to the nearest, if 5 or greater, round up to the nearest. Thus, 8.32 would be rounded to 8.30 if “Nearest” had been entered in this field, and 8.35 would round up to 8.40.

 

Once the index rate is pulled from the Interest Rate Table and the margin is added to or subtracted from it, the rate is then rounded based on these fields. If caps or maximum and minimum fields are used, rounding is performed prior to comparing to those fields.

 

Round Rate Field

 

 

 

WARNING: If you are rounding rates, the percentages in the Lifetime Maximum Rate Cap, Lifetime Minimum Rate Cap, Maximum Points Up, and the Maximum Points Down fields should be rounded to the same factor (1/8, 1/4, etc.). If the rounding factors don't match and the max/min is the newly calculated rate, then the rounding is thrown off because the max/min rate is used. Example: If you are rounding to eighths (1/8), you shouldn't have maximum/minimum rates of tenths (1/10) set.