Under the Setup master tab’s drop-down link bar, the product Setup link opens screens that enable you to configure the basic business guidelines necessary to support one or more products in the system. This includes defining the types of collateral your company supports, creating lending instruments, and determining what is included in credit bureau reporting. Setting up the Products screens requires a thorough understanding of the current rules of your business and must be completed before you can use Oracle Financial Services Lending and Leasing. The Products drop-down link opens screens to record data of all the products supported by the system and contains the following links:
Navigating to Products
In the Setup > Setup > Products link enables you to setup the options related to following closed ended products your company offers:
This chapter explains how to setup the screens associated with each one.
In Assets types you can setup the asset types that can serve as an application or account’s collateral. In addition, you can also define USAGE/RENTAL details along with USAGE/RENTAL charge matrix to facilitate usage billing calculation for Leased/Rented asset types.
The information on the Assets screen is used by the system to automatically display the appropriate collateral screen (Vehicle, Home, or Other) on the Application Entry screen.
The system recognizes the following four types of collateral:
Collateral Type |
Description |
Home collateral |
Homes, manufactured housing, or any real estate collateral. |
Vehicle collateral |
All vehicle types, such as cars, trucks, and motorcycles. |
Household goods and other collateral |
All other collateral types not defined as home, vehicle, or unsecured; for example, household items such as water heaters, televisions, and vacuums. |
Unsecured collateral |
All unsecured lending instruments. (This collateral type makes the collateral tabs on the system forms unavailable.) |
The Asset Sub Type section allows you to further categorize an asset; for example, the asset type vehicle might be categorized as car, truck, or van.
The Attributes/Addons and Makes and Models sub screens continue to further detail the asset both in description and value. For example, a vehicle asset might include addons such as leather seats and cruise control.
Note
Neither asset types nor asset sub types can be deleted. As they may have been used in the past, the display and processing of that data is still dependent on the existing setup.
To set up the Asset Types
You can either define new Asset Type or specify a new name in the New Asset Type field and click Create Copy to create a copy of selected asset with details.
A brief description of the fields is given below:
Field: |
Do this: |
Asset Type |
Specify the asset type. |
Description |
Specify the description for the asset. (This is the asset type which will appear throughout the system). |
Collateral Type |
Select the collateral type (the general category that the asset type falls within) from the drop-down list. Note: There is no need to define an asset for UNSECURED COLLATERAL, as by definition there is no asset on such account. |
Company |
Select the portfolio company to which the asset type belongs, from the drop-down list. These are the companies within your organization that can make Leases using this asset type. This may be ALL or a specific company. |
Branch |
Select the portfolio branch to which the asset type belongs, from the drop-down list. This is the branch within the selected company that can make Leases using this asset type. This may be ALL or a specific branch. This must be ALL if in the Company field you selected ALL. IMPORTANT: By selecting which asset type to use, the system searches for a best match using the following attributes: 1 Company 2 Branch Hence, the system recommends creating one version of each asset type where ALL is the value in these fields. |
Enabled |
Check this box to enable the asset type and indicate that the asset type is currently in use. |
A brief description of the fields is given below:
Field: |
Do this: |
Asset Sub Type |
Specify the asset sub type. |
Description |
Specify the description for the asset subtype |
Asset Property Type |
Select the type of property from the drop-down list. |
Enabled |
Check this box to enable the asset sub type. |
A brief description of the fields is given below:
Field: |
Do this: |
Attribute/Addon |
Displays the asset attribute or addon name for the selected asset). |
Description |
Select the description for the asset attribute/addon from the drop-down list. |
Default |
Specify the default text to be copied or displayed when the asset attributes and addons fields are completed on an application for this asset. |
Value |
Specify the default monetary value to be copied or displayed when the asset attributes and addons fields are completed on an application for this asset. |
Enabled |
Check this box to enable the asset attribute/Addon and indicate that it is available for this type of asset. |
A brief description of the fields is given below:
Field: |
Do this: |
Make |
Specify asset make. |
Model |
Specify asset model. |
Style |
Specify asset style type. |
Model Year |
Specify asset model year. |
Enabled |
Check this box to enable the asset make and model and indicate that it is included on fields for this asset type. |
The Usage / Rental Details sub tab allows you to define Usage/Rental definition details to categorize the incoming asset usage/rental data based on different parameters. The details maintained here are populated in Origination screen for billing calculation and can also be modified based on requirement.
For more information on how OFSLL handles Usage based leasing, refer to Appendix - Usage Based Leasing chapter and for Rental based leasing, refer to ‘Rental Agreement’ section in Lease Origination User Guide.
Field: |
Do this: |
Agreement Type |
Select the agreement type as one of the following from the drop-down list. The selected Agreement Type defines the criteria for pricing selection during billing calculation. - USAGE - RENTAL - USAGE RENTAL Note: Based on the above selected option, the other fields are either enabled or disabled for selection as indicated below: For Usage Agreement Type, the following fields are editable:
For Rental Agreement Type, the following fields are editable:
For Usage Rental Agreement Type, the following fields are editable:
|
Calc Method |
Select the calculation method as one of the following from the drop-down list. - TIERED (billing is based on the defined Usage/Rental Charge Matrix) - NON-TIERED (system automatically chooses the applicable slab based on the final usage value) |
Usage Cycle |
Select the frequency of billing the asset usage from the drop-down list. This field is disabled for RENTAL agreement type. |
Min Usage |
Specify the minimum usage value of the allowed range. This field is disabled for RENTAL agreement type. |
Max Usage |
Specify the maximum usage value of the allowed range. This field is disabled for RENTAL agreement type. |
Discount % |
Specify the percentage of discount exempted from final billing. |
Usage Rollover / Advance |
Select the type of asset usage calculation as one of the following: - ROLLOVER (remaining usage balance is carried forward to next cycle) - NO-ROLLOVER (remaining usage balance is not carried forward) - ROLLOVER AND ADVANCE (remaining usage balance is carried forward to next cycle + total usage limit for current cycle can be utilized upfront) - ADVANCE (total usage limit for current cycle can be utilized upfront) Note: This field is disabled for RENTAL and USAGE RENTAL agreement type and ‘NO-ROLLOVER’ option is applicable by default. |
Reset Frequency |
Specify the reset frequency of the billing cycle. This field is disabled for RENTAL and USAGE RENTAL agreement types and is available for ROLLOVER, ADVANCE and ROLLOVER AND ADVANCE methods of asset usage billing. |
Usage Term Calc Method |
Select the type of asset usage term for billing calculation as one of the following from the drop-down list: - ACTUAL - here the current details updated/received is treated as the final record for usage term calculation. - AVERAGE - here system takes the average of usage details received in previous cycles for usage term calculation. The calculation method selected here is populated to ‘Elastic Term Calc Method’ field in Origination/Servicing Collateral screen. This field is disabled for RENTAL and USAGE RENTAL agreement type. |
Discount Amount |
If you are defining Usage/Rental Details for RENTAL or USAGE RENTAL type of agreements, specify the discount amount allowed upfront from the final billing. This field is disabled for USAGE agreement type. |
Security Deposit |
If you are defining Usage/Rental Details for RENTAL or USAGE RENTAL type of agreements, specify the security deposit amount paid upfront for the term. This field is disabled for USAGE agreement type. |
Excess Rent Collection Method |
If you have selected the Agreement Type as USAGE RENTAL, select one of the following type of Charge Matrix to be used to derive the Excess Rent Collection Method from the drop-down list. - USING USAGE MATRIX - USING RENTAL MATRIX |
The Usage Charge Matrix sub tab allows you to define and maintain different chargeable slabs based on the combination of Billing Cycle and Charge Type. The details maintained here are used for billing calculation based on a particular asset usage.
For more information on how OFSLL handles Usage based leasing, refer to Appendix - Usage Based Leasing chapter and for Rental based leasing, refer to ‘Rental Agreement’ section in Lease Origination User Guide.
A brief description of the fields is given below:
Field: |
Do this: |
Billing Cycle |
Select the frequency of the billing cycle for the asset from the drop-down list. |
Units From |
Specify the minimum number of units from which the current usage charge matrix is applicable. |
Charge Per Unit |
Specify the amount to be charged for every unit. |
Charge Type |
Select the Charge Type as one of the following from the drop-down list. The list is displayed based on CHARGE_TYPE_CD lookup. - BASE (Units considered as base and chargeable at base rate) - EXCESS CYCLE (Units beyond base units and chargeable considering excess cycle) - EXCESS LIFE (Units exceeding the total contracted units and chargeable considering excess life cycle) Excess life is not applicable for Rental agreement type. |
Enabled |
Check this box to enable the charge matrix for usage calculation. |
The Rental Charge Matrix sub tab allows you to define and maintain different chargeable slabs based on the combination of Billing Cycle, Rental Duration, Charge Per Cycle and Charge Type. The details maintained here are used for billing calculation based on a particular asset usage.
For more information on how OFSLL handles Usage based leasing, refer to Appendix - Usage Based Leasing chapter and for Rental based leasing, refer to ‘Rental Agreement’ section in Lease Origination User Guide.
A brief description of the fields is given below:
Field: |
Do this: |
Billing Cycle |
Select the frequency of the billing cycle for the asset from the drop-down list. |
Rental Duration From |
Specify the minimum duration for which the rental charge is applicable. |
Charge Per Cycle |
Specify the amount to be charged for every rental cycle. |
Charge Type |
Select the Charge Type as one of the following from the drop-down list. The list is displayed based on CHARGE_TYPE_CD lookup. - BASE (Chargeable units exceeding from base units allowed) - EXCESS CYCLE (Chargeable units exceeding from billing cycle units) - EXCESS LIFE (Chargeable units exceeding the total contract term) Excess life is not applicable for Rental / Usage Rental agreement type. |
Enabled |
Check this box to enable the charge matrix for usage calculation. |
The Index Rates screen maintains your organization’s history of periodic changes in index rates. It allows you to define index rates to support variable rate lines of credit. The index rate provides the base rate for a credit line where:
interest rate = index rate + margin rate.
The Index section displays the currently defined indexes on the Lookups screen. You may create additional user-defined lookup codes for this lookup type as needed.
Note
You cannot tie an index rate to a product rate.
You can also record any index rate change on the Index Rates screen. During nightly batch processing, all the accounts with that index type are included when posting the RATE CHANGE transaction. After the system processes the batch, the interest rate of the account is changed. The system will use this new interest rate when computing all future interest calculations.
To set up Index Rates
Field: |
Do this: |
Index Type |
Select the type of index from the drop-down list. |
Short Description |
Specify a short description of the index. |
Description |
Specify the index description. |
Enabled |
Check this box to activate the index type. |
The Index Details section allows you to define multiple index values using the Start Dt and Rate fields.
Note
The history appears in descending order, with the most current record at the top.
A brief description of the fields is given below:
Field: |
Do this: |
Start Dt |
Specify the effective start date for the index rate. You can even select the date from the adjoining Calendar icon. |
Rate |
Specify the new index rate effective from above mentioned date as a percentage. Note: For the FLAT RATE index there should be only one entry with a Start Dt. = 01/01/1900 and a RATE = 0.0000. |
Enabled |
Check this box to activate the index rate effective from start date mentioned above. |
Note
Variable rate functionality is not extended to pre-compute accounts.
The Currency Exchange screen maintains currency exchange rates. You can define the currency exchange details and schedule a batch job (SET-IFP- ICEPRC_BJ_100_01 - CURRENCY EXCHANGE RATE FILE UPLOAD) which in-turn pulls the currency exchange rates from desired source at scheduled intervals through input file processing.
To set up the Currency Exchange
A brief description of the fields is given below:
Field: |
Do this: |
Currency |
Select the currency being exchanged from the drop-down list. |
Currency Pair |
Select the currency to be paired with from the drop-down list. |
Effective Date and Time |
Specify date and time of the exchange rate. You can even select the date from the adjoining Calendar icon. |
Rate |
Specify the exchange rate (required). |
Enabled |
Check this box to activate the currency exchange rate. |
With the Scoring Parameters, you can define the scoring parameters of a company’s credit scorecard and behavioral scoring.
Pricing scores apply to applications and are based on information recorded during origination, behavioral scoring applies to accounts and is based on account history attributes and performed on a monthly basis.
Credit Scoring
Parameters define the factors that can be used when scoring an application during underwriting and generating an initial decision on whether you wish to fund an amount. The combination of the flexible definition of these parameters, along with the scoring set up on the Scoring Models screen, allows you to automate much of the initial decision process in underwriting accounts.
The Formula Definition section on the Scoring Parameters screen allows you to build a mathematical expression to express the scoring parameter, test its validity, and locate specific information with the resulting scoring parameters. The system calculates scoring parameters using application data, credit bureau information, and applicant details.
To set up the Scoring Parameters
You can either define new Scoring Parameters or specify a new name in the New Parameter field and click Create Copy to create a copy of selected parameter with details.
A brief description of the fields is given below:
Field: |
Do this: |
Parameter |
Specify the name of the scoring parameter. The system recommends entering a name that in some way reflects how the parameter is used; for example, use FICO_SCORE instead of PARAMETER_1. |
Description |
Specify a description of the parameter. Again, Specify a name that reflects how the parameter is used; for example, use FICO SCORE and WEIGHTED FICO SCORE instead of FICO SCORE NUMBER 1 and FICO SCORE NUMBER 2. |
Data Type |
Select the data type of the scoring parameter being defined from the drop-down list. This determines how the system handles the values. (While DATE and CHARACTER are available data types, generally only NUMBER should be used when defining a scoring parameter. |
Scoring Type |
Select the scoring type from the drop-down list: credit scoring or behavioral scoring. |
Enabled |
Check this box to enable and indicate that the scoring parameter is available. |
The Formula Definition section allows you to define a mathematical expression of the scoring parameter you want to define. The expression may consist of one or more sequenced entries. All arithmetic rules apply to the formula definition. If errors exist in the formula definition, the system displays an error message in this section when you choose Show Expression.
A brief description of the fields is given below:
Field: |
Do this: |
Seq |
Specify the sequence number (the order in which the formula definition variable will be assembled and evaluated). |
( |
Specify a left bracket, if you need to group part of your formula definition. |
Variable |
Select the variable from a validated field based on the user-defined table SCR_CRED_SUMMARY: SCORING PARAMETERS, from the drop-down list. |
Constant Value |
Specify the constant value (optional). |
Mathematical Operator |
Select the math operator to be used on the adjacent formula definition rows, from the drop-down list. |
) |
Specify a right bracket, if you are grouping part of your formula definition. |
Enabled |
Check this box to enable the formula and indicate that it is included when building a definition for the scoring parameter. |
The mathematical expression appears in the Formula Expression section (in sequential order) in the Expression field.
The Product screen defines the closed ended products your organization offers. This screen is enhanced to support Islamic along with the conventional.
A product is based on the following attributes:
The Product Definition section records details about the product such as the description, start and end dates, collateral type and sub type, credit bureau reporting attributes, billing cycle, index and rate calculation attributes.
System supports ‘Biennial’ (once every 2 years) and Triennial (once every 3 years) type of billing cycles. Based on the following lookups, the billing cycle ‘frequency’ can be defined:
For a lease product definition, the calculation is based on either Rent Factor or Interest Rate and Contract and Pricing definition will be driven depending on one of the above option selected.
The Product Itemization section is used to define itemized entries for a product. This information is used on the Itemization sub screens of the Application Entry and Application screens.
The Rate Adjustments section is used to define the frequency of rate change allowed during interest rate calculations.
To set up the Product
You can either define new Product details or specify a new product code in the New Product field and click Create Copy to create a copy of selected product with details.
A brief description of the fields is given below:
Field: |
Do this: |
Product |
Specify the product code as defined by your organization (in other words, how you want to differentiate the products). For example, products can be differentiated according to asset. The product code, or name, is unique. |
Description |
Specify the description of the product. (This is the product description as it appears throughout the system). |
Start Dt |
Specify the start date for the product. You can even select the date from the adjoining Calendar icon. |
End Dt |
Specify the end date for the product. You can even select the date from the adjoining Calendar icon. |
Direct |
Check this box, if you need the product to be originated directly to customer. (In this case, the compliance state is the state listed in the customer’s current mailing address.) If unchecked, the product is an indirect lending product; that is, payment is made to the producer. (In this case, the compliance state is the state listed in the producer’s address.) |
Close Account After Paid-Off |
Check this box to allow the account to be closed once the account is paid off i.e. system closes the account after the number of days specified in the system parameter has elapsed. This option is selected by default. If not selected, system ignores the system parameter and does not close the account even if the account is paid off i.e. system keeps the accounts active so that the equity can be traded with other accounts. For information on accounts trading, refer to ‘Appendix - Trading of Accounts’ chapter. Note: If the business practice of a financial institution is ‘not’ to close the accounts then this Indicator need to be unchecked. Mainly in the Vacation Ownership where a Timeshare Loan can be traded anytime even if the account is paid-off, this feature is used. |
Customer Credit Limit |
Check this box to enable ‘Customer Credit Limit’ tab in Origination module. Using the ‘Customer Credit Limit’ tab, an underwriter can define a specific credit limit for the customer while funding the first application and based on that credit limit, subsequent applications can be funded. For more information, refer to ‘Customer Credit Limit’ details in User Guide. |
Same Billing Cycle |
Check this box to set the same billing cycle (supported only billing cycles Monthly and Weekly) for all the future applications funded for an existing customer. |
Enabled |
Check this box to activate the product. Note: You can check this box only when Rate adjustment schedule is maintained, i.e., All the products should be variable rate products |
Collateral Type |
Select the collateral type for the product, from the drop-down list. This field identifies what type of collateral is associated with the and assists the system in identifying the correct screen(s) to display. |
Collateral Sub Type |
Select the collateral sub type for the product, from the drop-down list. |
Credit Bureau Portfolio Type* |
Select the credit bureau portfolio type for the product, from the drop-down list. |
Credit Bureau Account Type* |
Select the account type for the product, from the drop-down list. *Note: The Credit Bureau Portfolio Type and Credit Bureau Account Type fields determine how the portfolio is reported back to the credit bureaus. |
Billing Cycle |
Select the billing cycle for the product, from the drop-down list. Note: This field is not editable and the billing cycle is selected as MONTHLY by default if the lease calculation method is selected as RENT FACTOR. |
Category |
By default the category of the product is selected as STANDARD and is not editable. |
Calculation Parameters: This section allows you to define the parameters for lease calculation starting from choosing the calculation method. |
|
Calculation Method |
Select the type of lease calculation method as one of the following:
If the lease calculation method is selected as ‘Interest Rate’, the following fields are enabled in the screen and also the ‘Rate Adjustments’ sub tab is available to specify the details:
|
Flexible Repayment |
Check this box to allow flexible repayment for the Product. When you check this check box, the Flexible Repayment Allowed box of Repayment Options section available under Funding tab > Contract sub tab > Replacement sub tab of Funding screen. Note: On the Repayment sub screen of Contract link on Funding screen, you may only enter the desired repayment schedule type in the Repayment section’s Type field if the Flexible Repayment Allowed is selected. |
Index Rounding |
Select the index rate rounding factor for the product, from the drop-down list. Note: For more information, refer Appendix C: Rounding Amounts and Rate Attributes. |
Reschedule Method |
Select the rate change reschedule method for the variable rate product, from the drop-down list. Select CHANGE PAYMENT, if you want to automatically recalculate the repayment amounts on the interest rate change. Select UNDEFINED (the default value), if you do not want to take any action on interest rate change. |
Reschedule Value |
Specify the value in percent (%) to decide the repayment change. For example, if you enter 10, then the periodic repayment amount will change only if the newly computed repayment amount is higher by 10% of the previous repayment amount. Specify 0 if you want to change repayment amounts with every index rate change. |
Agreement Type |
If you have selected the ‘Collateral Type’ as either VEHICLE COLLATERAL or HOUSEHOLD GOODS AND OTHER COLLATERAL, you can select one of the following types of lease agreement from the drop-down list for further calculation: - USAGE - RENTAL - USAGE RENTAL Note: For each Usage or Rental details defined in ‘Asset Type’ screen, you can define only one record for each asset type (i.e. one for Usage and one for Rental). Based on the selected option, OFSLL handles the lease calculation and billing. For more information on Usage based leasing, refer to Appendix - Usage Based Leasing chapter and for Rental based leasing, refer to ‘Rental Agreement’ section in Lease Origination User Guide. |
Note
The 'Reschedule Method' and 'Reschedule Value' fields allows you to define and control the changes in lease amount for Variable and Fixed rate lease during originating, funding, and servicing. For more information, refer Variable and Fixed Interest Rate.
A brief description of the fields is given below:
Field: |
Do this: |
Itemization |
Select the itemization type for the product selected in product definition section, from the drop-down list. |
Discount Rate |
Specify the discount rate. |
Sort |
Specify the sort order. |
Sign |
Select +ve for a positive number and -ve for a negative number. Note: The +ve and -ve buttons determine whether the values will increase or decrease the itemization total for the product based on the selected product. Together the contents of the Product Itemization sub screen, positive and negative, add up to the amount. |
Enabled |
Check this box to indicate that this product itemization is currently available. |
The Rate Adjustment sub tab is enabled for lease calculation based on Interest Rate.
A brief description of the fields is given below:
Field: |
Do this: |
Seq |
Specify the sequence number of the rate change adjustments. Consider 1 as the initial (first) rate change adjustment frequency. All subsequent frequencies will be considered for rate change adjustments according to their sequence number. |
Adjustment Frequency |
Select the frequency value for adjustments, from the drop-down list. Currently, the following values are available in the system: RATE CHANGE OCCURS EVERY X YEARS RATE CHANGE OCCURS EVERY X MONTHS RATE CHANGE OCCURS EVERY X DAYS RATE CHANGE OCCURS EVERY BILLING DATE RATE CHANGE OCCURS EVERY DUE DATE RATE CHANGE OCCURS AT MATURITY |
Period |
Specify the period associated to adjustment frequency. For example, if you select the adjustment frequency as RATE CHANGE OCCURS EVERY X YEARS and enter 5, the rate change occurs every five years. |
# of Adjustments |
Enter the number of adjustments associated with the adjustment frequency. For example, in above example, if you enter the value as 2, then rate payment adjustment occurs on the product every five years and will happens 2 times before switching to the next adjustment frequency. |
Enabled |
Check this box to indicate that this rate adjustment is currently available. |
The Pricing screen records pricing information related to your products. the system uses the information in the Pricing Definition section to identify the correct pricing for an application, depending upon the product and the specific application parameters. the system will always search for a unique match.
When you choose the Select Pricing while making a decision on the Underwriting window, the system displays the best match and completes the Pricing and Approved sections under Summary sub tab. The information in the Approved section cite the minimum amounts for the loan, though the user can edit these figures.
The system determines the best match by looking at all enabled pricing strings on the Pricing screen that meet the following criteria:
Exact matches for each field are given a higher weight than matches of ALL. The returned rows are then ranked based on the weighted values and the hierarchical position of the field (see above). They are then ranked by start date. The system recognizes the first row returned as the best match.
Note
System supports ‘Biennial’ (once every 2 years) and Triennial (once every 3 years) type of billing cycles. Based on the following lookups, the billing cycle ‘frequency’ can be defined:
To set up the Pricing
A brief description of the fields is given below:
Field: |
Do this: |
Pricing* |
Specify the code for the pricing. |
Description* |
Specify the description for the pricing. |
* Together these two fields define the name of the pricing. |
|
Start Dt |
Specify the start date for this pricing. You can even select the date from the adjoining Calendar icon. |
End Dt |
Specify the end date for this pricing. You can even select the date from the adjoining Calendar icon. |
Enabled |
Check this box to enable the pricing. |
Result section |
|
Residual % From |
Specify the minimum residual percentage valid with this pricing. |
Residual % To |
Specify the maximum residual percentage applicable with this pricing. |
Index |
The index type associated with this rate pricing is auto-populated based on lease calculation method selected in Selection Criteria section. The same is derived from INDEX_TYPE_CD lookup. Note: For RENT FACTOR calculation method, only FLAT RATE index is applicable and is selected by default. |
Rate From |
Specify the minimum applicable rate. |
Rate To |
Specify the maximum applicable rate. |
Buy Rate |
Specify the buying rate. |
Rent Factor From |
Specify the minimum money factor valid with this pricing. Note: This field is disabled if the lease calculation method is selected as ‘Interest Rate’ in Selection Criteria section. |
Rent Factor To |
Specify the maximum money factor valid with this pricing. Note: This field is disabled if the lease calculation method is selected as ‘Interest Rate’ in Selection Criteria section. |
Buy Rent Factor |
Specify the ratio of buy rent factor. Note: This field is disabled if the lease calculation method is selected as ‘Interest Rate’ in Selection Criteria section. |
Maturity Index |
Select the maturity index type associated with this variable rate pricing from the drop-down list. Note: This field is disabled if the lease calculation method is selected as ‘Rent Factor’ in Selection Criteria section. |
Maturity From |
Specify the lowest maturity rate allowed for loans using this variable rate pricing. Maturity rate is the rate to be charged on the product if it remains unpaid after its last term has been billed. Note: This field is disabled if the lease calculation method is selected as ‘Rent Factor’ in Selection Criteria section. |
Maturity To |
Specify the maximum maturity rate allowed for products using this pricing. Note: This field is disabled if the lease calculation method is selected as ‘Rent Factor’ in Selection Criteria section. |
Maximum Capital Cost |
Specify the maximum capital cost valid for this pricing. |
Maximum Term |
Specify the maximum term financed for this pricing. |
Selection Criteria |
|
Company |
Select the portfolio company for this pricing, from the drop-down list. This may be ALL or a specific company. |
Branch |
Select the portfolio branch for this pricing. This may be ALL or a specific branch. (This must be ALL if in the Company field you selected ALL), from the drop-down list. |
Calculation Method |
Select the type of lease calculation method for this pricing as one of the following:
|
Billing Cycle |
Select the billing cycle for this pricing, from the drop-down list. Note: The billing cycle is defaulted as Monthly if the lease calculation method is selected as ‘Rent Factor’. |
Agreement Type |
Select the lease agreement type as one of the following from the drop-down list. The selected Agreement Type defines the criteria for pricing selection during further calculation. - USAGE - RENTAL - USAGE RENTAL For more information on how OFSLL handles Usage based leasing, refer to Appendix - Usage Based Leasing chapter and for Rental based leasing, refer to ‘Rental Agreement’ section in Lease Origination User Guide. |
Product |
Select the product for this pricing, from the drop-down list. This may be ALL or a specific product. The available values are filtered and displayed based on the lease calculation method selected. Note: Selecting ‘ALL’ here refers to all the products associated with the calculation method and not to the total list of products maintained in the system. |
State |
Select the state for this pricing, from the drop-down list. This may be ALL or a specific state. |
Pro Group |
Select the producer group for this pricing, from the drop-down list. This may be ALL or a specific producer group. |
Pro Type |
Select the producer type for this pricing, , from the drop-down list. This may be ALL or a specific producer type. |
Producer Region |
Select the region of the producer. |
Producer Territory |
Select the territory of the producer. |
Producer |
Select the producer from the drop-down list. This may be ALL or a specific producer. The available values come from a validated field based on the product group and product type. |
Grade |
Select the credit grade for this pricing, from the drop-down list. This may be ALL or a specific grade. |
Gross Capital Cost |
Specify the minimum gross capital cost which is valid for this pricing. |
Lease Term |
Specify the minimum lease term for which this pricing is valid. |
Asset Class |
Select the asset class from the drop-down list. This may be ALL or a specific asset class. The available values come from a validated field based on the collateral type. You may create additional user-defined lookup codes for these lookup types as needed. |
Asset Type |
Select the asset type from the drop-down list. This may be ALL or a specific asset type. The available values come from a validated field based your assets setup. |
SubType |
Select the asset sub type from the drop-down list. This may be ALL or a specific asset sub type. The available values come from a validated field based your assets setup, and is linked to the selected asset type. |
Asset Make |
Select the asset make from the drop-down list. The available values come from a validated field based your assets setup and is restricted based on the selected Asset Type and Asset Sub Type. For example, If ALL was selected for either Asset Type or Asset Sub Type, then ALL will be the only available selection for the asset make. |
Asset Model |
Select the asset model from the drop-down list. The available values come from a validated field based your assets setup, and is restricted based on the selected Asset Type and Asset Sub Type. If ALL was selected for either Asset Type or Asset Sub Type, then ALL will be the only available selection for the asset model. |
Age |
Specify the asset age (the minimum age for the selected pricing). Note: If your entry in this field is based on the number of years of age of the asset and not the actual year of make, you must update this entry annually to ensure that the proper pricing is available. |
Trade-In |
Specify if there is a trade in of an asset by selecting Yes/No. |
Mileage |
If there is a Trade-In of an existing asset, then specify its mileage in km. |
Currency |
Select the currency for this pricing, from the drop-down list. |
Promotion |
Select the promotion applicable for this pricing from the drop-down list. The list is populated based on the promotions setup. |
Subvention |
Select the subvention plan from the drop-down list, if pricing is specific for any subvention plan. |
Down Pmt |
Specify the down payment for the pricing. |
Asset Value |
Specify the asset value. |
LTV |
Specify the loan to value ratio. |
Existing Customer |
Select one of the following options from the drop-down list to define the applicability of the current pricing definition: ALL - Applicable to both existing and new customers YES - Applicable to existing customer only NO - Applicable to new customer only. Based on the selection criteria, system defaults the first pricing for applications with ‘Existing customer flag = Y’ at primary applicant details. |
Existing Customer Since (In Years) |
Specify the duration from when customer account was created in the system up to the current date in years. |
Selection Criteria: Business - allows you to indicate the age of business by evaluating the total number of years elapsed. |
|
Years In Business |
Specify the total number of years in business. |
The Contract screen allows you to define the instruments used within your system. A instrument is a contract used by a financial organization with specific rules tied to it. When processing an application, an instrument associated with the application informs the system of the type of contract being used for the approved loan. This ensures that all parameters tied to the instrument are setup for the account as it is booked - without requiring you to do it.
Instruments can be setup at different levels:
The following groups of parameters are setup at the instrument level (Each has its own section on the Contract screen):
Items defined in the contract are “locked in” when you choose Select Instrument on the Funding form’s Contract link.
The Contract screen’s Instrument and Description fields allow you to enter the financial instrument’s name and description.
System supports ‘Biennial’ (once every 2 years) and Triennial (once every 3 years) type of billing cycles. Based on the following lookups, the billing cycle ‘frequency’ can be defined:
To set up the Contract
You can either define new Contract Definition details or specify a new name in the New Instrument field and click Create Copy to create a copy of selected contract with details.
A brief description of the fields is given below:
Field: |
Do this: |
Contract Definition section |
|
Instrument |
Specify the code identifying the instrument. |
Description |
Specify the description of the instrument being defined. |
Start Dt |
Specify the start date for the instrument. You can even select the date from the adjoining Calendar icon. |
End Dt |
Specify the end date for the instrument. You can even select the date from the adjoining Calendar icon |
Enabled |
If you check this box, the system will consider this contract definition when selecting a instrument for an application. Note: Once the field is enabled load balances button in balances sub tab will be disabled |
Selection Criteria section |
|
Company |
Select the company for the instrument from the drop-down list. This may be ALL or a specific company. |
Branch |
Select the branch within the company for the instrument from the drop-down list. This may be ALL or a specific branch. This must be ALL, if you have selected ‘ALL’ in the Company field. |
Calculation Method |
Select the type of lease calculation method for the contract as one of the following:
Note: Based on the above selection, some of the fields in lease contract definition screen are either disabled or is displayed in view only mode with default supported option. The same is detailed in respective fields. |
Billing Cycle |
Select the billing cycle frequency for the contract as one of the following from the drop-down list.
Note: The billing cycle is selected as ‘Monthly’ by default and is not editable if the lease calculation method is selected as ‘Rent Factor’. |
Agreement Type |
Select the lease agreement type as one of the following from the drop-down list for further calculation: - USAGE - RENTAL - USAGE RENTAL For more information on how OFSLL handles Usage based leasing, refer to Appendix - Usage Based Leasing chapter and for Rental based leasing, refer to ‘Rental Agreement’ section in Lease Origination User Guide. |
Product |
Select the product for the instrument from the drop-down list. This may be ALL or a specific product. If the Agreement Type is selected as either USAGE or RENTAL, then the drop-down list displays only those products associated with USAGE or RENTAL type of lease. |
State |
Select the state in which the instrument is used from the drop-down list. This may be ALL or a specific state. |
Currency |
Select the currency for the instrument from the drop-down list. By selecting which type to use, the system searches for a best match using the following attributes: 1. Billing Cycle 2. Start Date 3. Company 4. Branch 5. Product 6. State Hence, Oracle Financial Services Software recommends creating one version of each type, where ALL is the value in these fields. |
Pricing |
Select the pricing in which the instrument is used from the drop-down list. This may be ALL or a specific pricing. |
Accrual section |
|
Rent Accrual Method |
Depending on the lease calculation method selected, the applicable rent accrual method which is used to calculate interest accrual for this instrument is defaulted from the drop-down list. - For Rent Factor calculation method, ACTUARIAL - MONTHLY method is selected by default. - For Interest Rate calculation method, INTEREST BEARING method is selected by default. Note: System displays an error on save if any of the above default options are interchanged. |
Base Method |
Select the base method used to calculate interest accrual for this instrument from the drop-down list. The list is populates with the values defined in ACCRUAL_BASE_METHOD_CD lookup code. Note: The base method is selected as 30/360 by default if the lease calculation method is selected as ‘Rent Factor’. |
Start Dt Basis |
If the lease calculation method is selected as Interest Rate, then the start date is by default is Effective Date and the interest is calculated from the lease Contract date. If the lease calculation method is selected as Rent Factor, this field is disabled since it is not applicable. |
Start Days |
Specify the number of days for which the interest accrual is to be calculated. Note: If the lease calculation method is selected as Rent Factor, this field is disabled since it is not applicable. |
Time Counting Method |
Select the time counting method used to calculate interest accrual for this instrument from the drop-down list. Note: If the lease calculation method is selected as Rent Factor, this field is disabled since it is not applicable. |
Installment Method |
System supports an amortized repayment schedule with the final payment potentially differing from the regular payment amount in the other billing cycles. If the lease calculation method is selected as Interest Rate, then the installment method by default is EQUATED PAYMENTS where-in the equal installments for each billing cycle includes any minute final payment differences. If the lease calculation method is selected as Rent Factor, this field is disabled since it is not applicable. |
Int Amortization Freq |
Select the interest amortization frequency from the drop-down list. You can either select DAILY or MONTHLY (MONTH END) which is selected by default. |
Scheduled Dues section |
|
Due Day Min |
Specify the minimum value allowed for the due day for this instrument. |
Due Day Max |
Specify the maximum value allowed for the due day for this instrument. Note: If billing cycle is selected as weekly, then Due Day Max field value cannot be greater than 7. |
Max Due Day Change / Year |
Specify the maximum number of due day changes allowed within a given year for this instrument. |
Max Due Day Change / Life |
Specify the maximum number of due day changes allowed over the life of a product funded with this instrument. |
Max Due Day Change Days |
Specify the maximum number of days a due date can be moved. |
Pmt Tolerance Amt* |
Specify the payment tolerance amount. This is the threshold amount that must be achieved before a due amount is considered PAID or delinquent. If (Payment Received + Pmt Tolerance: $Value) >= Standard Monthly Payment, the Due Date will be considered as satisfied in terms of delinquency. The amount unpaid is still owed. |
Pmt Tolerance%* |
Specify the payment tolerance percentage. This is the threshold percentage that must be achieved before a due amount is considered PAID or delinquent. If Payment Received >= (Standard Monthly Payment * Pmt Tolerance% / 100), the due date will be considered satisfied in terms of delinquency. The amount unpaid is still owed. The system uses the greater of these two values. |
Promise Tolerance Amt* |
Specify the promise tolerance amount. This is the threshold amount that must be achieved before a due amount is considered kept or Broken. If (Payment Received + Promise Tolerance: $Value) >= Promise Amount, the Due Date will be considered kept (satisfied). |
Promise Tolerance %* |
Specify the promise tolerance percentage. This is the threshold percentage that must be achieved before a due amount is considered kept or Broken. If Payment Received >= (Promised Amt * Promise Tolerance%), the due date will be considered kept (satisfied). The system uses the greater of these two values. |
Billing section |
|
Prebill Days |
Specify the prebill days. This is the number of days, before the first payment due, that accounts funded with this instrument will be billed for the first payment. Thereafter, the accounts will be billed on the same day every month. If an account has a first payment date of 10/25/2003 and Pre Bill Days is 21, then the account will bill on 10/04/2003, and then bill on the 4th of every month. |
Bill Type |
Select the billing type for accounts funded using this instrument from the drop-down list. |
Bill Method |
Select the billing method for accounts funded using this instrument from the drop-down list. |
Balloon Method |
If the lease calculation method is selected as Interest Rate, then the balloon payment method for accounts funded using this instrument is ‘N + 1 PMTS’ by default. Amortization happens based on N+1 payments. However, this field is not applicable if the lease calculation method is ‘Rent Factor’. |
Multiple Billing Asset Rate |
Check this box to indicate if multiple asset rates are applicable for one billing period. System considers billing period from current due date to the next due date. Multiple rates are fetched only when rate end date (rate start date + rate frequency) ends one or more cycle(s) before the next due date i.e. current rate record does not cover the entire billing period. |
Delinquency section |
|
Late Charge Grace Days |
Specify the number of grace days allowed for the payment of a due date before a late charge is assessed on the account. |
Stop Accrual Days |
Specify the number of days a contract can be in delinquent state, after which the interest accrual must stop for an account. A Batch Job is run daily to select accounts in delinquent status for a pre-defined number of days and post ‘No Accrual transaction’ for such accounts on current date. When the account recovers from Delinquency, the system will then post a ‘Start Accrual Transaction’ on the date the account is recovered from delinquency. |
Delq Grace Days |
Specify the number of grace days allowed for the payment of a due date before an account is considered delinquent. This affects DELQ Queues, the system reporting, and the generation of collection letters. |
Time Bar Years |
Specify the total number of years allowed to contact the customer starting from the first payment date and beyond which the account is considered delinquent. You can specify any value between 0-999. |
Cure Letter Gen Days |
Specify the number of delinquency days to initiate cure letter generation. |
Cure Letter Valid Days |
Specify the number of days during which the issued cure letter is valid. Usually financial institutions will start the collection activities after the lapse of cure letter validity date. |
Delq Category Method |
Select the delinquency category method to determine how the system populates delinquency counters on the Customer Service form. Note: This value does not affect credit bureau reporting. |
Accrual Post Maturity |
Check this box to indicate that this is the post maturity default rate. Extensions allow you to extend the maturity of the contract by one or more terms by allowing the customer to skip one or more payments. The skipped terms are added to the end of the contract. Note: If the lease calculation method is selected as Rent Factor, this field is disabled since it is not applicable. |
Lease Contract section |
|
Lease Type |
Select the lease type from the drop-down list. You can select the lease type as either Direct Finance or Operating Lease. If the lease Type is selected as Direct Finance, system enables the field ‘Residual Value in Final Bill’ under Residual Details section for selection. |
Tax Book Type |
Select the lease tax book type for depreciation from the drop-down list. |
Depreciation section In this section you can define asset depreciation method and frequency. The same is used for asset depreciation calculation when the batch job TAMDEP_BJ_121_01 (DEPRECIATION RATE PROCESSING) is executed. If asset is associated to an account then an ‘Asset Depreciation’ amortization transaction is posted on to the account with new delta depreciated value. Asset depreciation is calculated till the entire lease term or till the asset residual amount becomes ‘0’. |
|
Depreciation Method |
Select the asset depreciation method to be used for calculation as one of the following from the drop-down list. - FLAT RATE: This method is used to depreciate the asset over a fixed time using a fixed rate. This method of calculation is similar to Written Down Value Method (Diminishing Balance Method / Reducing Installment Method). On selecting this option, the following fields - Base Rate, Adjusting Rate and Bonus Rate are enabled to define the flat rate. - LIFE BASED: This method is used to depreciate the asset over a fixed time using the specified rates. This method of calculation is similar to Straight Line Method (Original Cost Method / Fixed Installment Method). On selecting this option and saving the record, ‘Depreciation Rate Schedule’ sub tab is enabled to define depreciation rates slab. |
Depreciation Convention |
Select the frequency at which the leased account should be updated with depreciation details from the drop-down list. The list is populated with frequency details (i.e. monthly, weekly, and so on) maintained in ‘FIRST_LAST_YEAR_CONVENTION_CD’ lookup code. |
Base Rate |
If you have selected the Depreciation Method as ‘Flat Rate’, specify the estimated base depreciation rate. |
Adjusting Rate |
If you have selected the Depreciation Method as ‘Flat Rate’, specify the adjusting rate at which the above base rate should be increased to derive the flat rate of depreciation. For example, - If base rate is 10 and adjusted rate is 10 then flat rate is 11 - If base rate is 10 and adjusted rate is 20 then flat rate is 12 |
Bonus Rate |
If you have selected the Depreciation Method as ‘Flat Rate’, specify the bonus rate (if any) which is additional depreciation allowed on base rate for calculating flat rate depreciation. Bonus rate is a tax incentive offered to deduct a percentage of the purchase price of eligible business assets and as a measure of relief for small to medium sized businesses to buy additional equipment. For example, - If base rate is 10 and bonus rate is 10 then flat rate is 20 - If base rate is 10 and bonus rate is 2 then flat rate is 12 |
Depreciation Rate |
View the system calculated flat rate depreciation value which is calculated as: Depreciation Rate% = (Base Rate x (1 + Adjusting Rate/100)) + Bonus Rate. |
Tax section |
|
Sales Tax Mode |
Select the sales tax mode from the drop-down list. |
Sales Tax Method |
Select the sales tax method from the drop-down list. |
Early Termination section |
|
Allowed To Terminate |
Check this box to indicate if the contract is allowed to be terminated before the maturity date. Note that, system validates and allows termination only if either the Billed Term or Lease Amount Recovered % is met. |
Billed Term |
Specify the minimum number of bills that needs to be generated before allowing for early termination. |
Lease Amt Recovered % |
Specify the percentage of lease amount to be recovered to allow early termination. The calculation for minimum lease amount to be recovered for Rent Factor and Interest Rate is as indicated below: For calculation method as Rent Factor, Minimum lease amount = (Depreciation + Rent Charge i.e. Lease Receivable balance) that needs to be recovered before allowing early termination. For calculation method as Interest Rate, the Minimum lease amount = (Depreciation + Rent Charge i.e. Lease Receivable balance + Interest balance) that needs to be recovered before allowing early termination. |
Residual Details section |
|
Minimum Residual % |
Specify the minimum residual percentage that is allowed to be specified in Origination > Contract screen (Residual % field). |
Maximum Residual % |
Specify the maximum residual percentage that is allowed to be specified in Origination > Contract screen (Residual % field). |
Auto Include Residual Value |
Check this box to indicate if the Residual value of the asset is to be included in the final bill. This check box is disabled if the lease Agreement Type in ‘Selection Criteria’ section is selected as USAGE RENTAL. When bill is generated, system validates if the generated bill is last bill and includes the Residual Value (either Contract Value or FMV (fair market value) based on selection) in the final bill. For FMV, the total value of all collaterals are considered. Here, Contract value is the value determined as residual value during the contract agreement time and FMV is the value of asset at the end of the lease term. Also when residual value is included in final bill, system does not allow to post an Extension transaction and displays an error while posting the same. |
Residual Valuation |
If the above check box is selected, you need to select the Residual Valuation as either Contract Value or Fair Market value from the drop down list. Note: Fair Market Value is referred from Collateral > Valuation tab. |
Payment Caps section |
|
Max Pmt Inc / Year |
Specify the maximum payment increase allowed in a year.
Note: If the lease calculation method is selected as Rent Factor, this field is disabled since it is not applicable. |
Max Pmt Inc / Life |
Specify the maximum payment increase allowed in the life of the loan. Note: If the lease calculation method is selected as Rent Factor, this field is disabled since it is not applicable. |
Extension section Note: If the lease calculation method is selected as Rent Factor, the fields in this section are disabled since it is not applicable. |
|
Max Extn Period / Life |
Specify the maximum number of terms that the contract may be extended, beyond the life of the Lease. |
Max # Extn / Life |
Specify the maximum number of extensions that may be granted beyond the life of the Lease. |
Minimum # of Payments |
Specify the minimum number of payments that must be made before lease extension. |
Rate Cap & Adjustments section Note: If the lease calculation method is selected as Rent Factor, the fields in this section are disabled since it is not applicable. |
|
Max Rate Inc / Year |
Specify the maximum rate increase allowed in a year. |
Max Rate Inc / Life |
Specify the maximum rate increase allowed in the life of the loan. |
Max Rate Dec / Year |
Specify the maximum rate decrease allowed in a year. |
Max Rate Dec / Life |
Specify the maximum rate decrease allowed during the life of the loan. |
Max # Adjust / Year |
Specify the maximum number of rate changes allowed in a year. |
Max # Adjust / Life |
Specify the maximum number of rate changes allowed during the life of the loan. |
Min Int Rate (Floor) |
Specify the minimum rate. |
Max Int Rate (Ceiling) |
Specify the maximum rate. |
Statement section This section allows to define the preferences for Mock Statement generation at Master Account level. Generating a Mock Statement helps to mock the asset billing process with a future date and to get an upfront statement indicating future dues of Master and Associated Accounts. In ‘Vacation Ownership’ industry, such statements are required to forecast future dues based on current ‘Timeshare’ holdings. The selected preference here are propagated to Application > Contract screen when the instrument is loaded. |
|
Mock Statement Req |
Select this check box to indicate if the account is to be include in Mock statement Generation. Note: Based on this selection, others fields related to Mock Statement below are enabled and becomes mandatory for providing details. |
Mock Start Month |
Select the start month of Mock Statements period from the drop-down list. Note: During the ‘Mock Statement Next Run Date’ validation if next run date is less than Contract Date or GL Date, system moves the ‘Mock Start Month’ to same month of next year. For more information, refer to ‘Mock Statement Maintenance’ in Appendix - Non Monetary transactions sections. |
Mock Statement Cycles |
Select the total number of billings (between 1-12) that are to be generated post Mock Statement Start Date. |
Mock Pre Statement Days |
Specify the number of Pre bill days allowed before for Mock Statements generation. |
Other section |
|
Rent Collection Method |
Select the applicable rent collection method from the drop-down list. If the lease calculation method is selected as Rent Factor, the rent collection method is set to ADVANCE by default. For Interest Rate calculation method, you can either select ADVANCE or ARREARS. In case of ADVANCE, the first payment date must be equal to contract date and first bill would be generated on contract date. In case of ARREARS, you can specify the first payment date as future date and bill would be generated accordingly. |
Refund Allowed |
Check this box to indicate that refunding of customer over payments are allowed. |
Refund Tolerance Amt |
Specify the refund tolerance amount. If the amount owed to the customer is greater than the refund tolerance, the over payment amount will be refunded if Refund Allowed box is selected. |
Anniversary Period |
Specify the anniversary term that define the anniversary period. This is based on billing cycle, so normally for MONTHLY the value is 12 and for WEEKLY the value is 52. |
Contract Expiry Letter Days |
Specify the number of days before the maturity to generate the ‘Contract Maturity’ letter. |
WriteOff Tolerance Amt |
Specify the write off tolerance amount. If the remaining outstanding receivables for accounts funded using this instrument is less or equal to the write off tolerance amount, the remaining balance on the account will be waived. |
Recourse |
Check this box if recourse is allowed. This indicates whether the unpaid balance may be collected from the producer if the consumer fails to perform on the loan. |
Max Recourse% |
Specify the maximum percentage of the outstanding receivables that may be collected from the producer if the Recourse Allowed box was selected. |
Repmt Currency |
Select the designated repayment currency for this contract from the drop-down list. |
PDC Security Check |
Check this box to indicate that post dated checks are the method of repayment for this contract. |
Default Pmt Spread |
Select the default payment spread to be used when receiving payments for this account if one is not explicitly chosen, from the drop-down list. |
ACH Fee |
Check this box to indicate that direct debit fee is included. Note: The ACH Fee/Direct Debit Fee balance will be displayed in Balances sub tab only when this checkbox is selected. |
Track Down Payment Balance |
Select this check box for system to validate if ‘Down Payment Balance’ is loaded. This helps to record the Down Payment balance Agreed and Paid by the customer. If selected, system validates if Down Payment Balance is loaded in the contract setup. However, system does not validate Down Payment Balance if unchecked. This check box is available only for Loan and Lease contracts. |
The system facilitates extension of terms, provided the following conditions are satisfied:
If the above conditions are not satisfied, then the system displays an appropriate error message.
A new transaction Force Extension will be available. This transaction will be posted when you want the system to bypass the extension validations defined at the contract level.
When a backdated transaction with TXN Date exists before the transaction date of extension, all the transactions are reversed and posted again. If extension transaction is posted again, then the validation rules are not validated again.
Staged funding for closed-end loans allows you to disburse funds to customers through multiple advances or draws up to the approved amount within a specified “draw period.”
To create a multiple disbursement contract for a transaction
Note
You cannot clear the Multi Disbursement Allowed box in the Advance section on the Contract screen.
Note
This information appears in the Advance section of the Funding screen’s Contract link.
Note
For more information, see the Edits link (Edits screen) section in this chapter.
These edits appear on the Funding screen’s Verification screen.
When funding a loan, the system computes repayment schedules from the contract date, irrespective of whether funds have been disbursed or not. The system uses the approved amount (amount financed) for computing repayment schedules on the contract date.
As the might have been disbursed through multiple draws, or the draws have been less than the approved amount, or the amount may have been repaid in some amount before the draw end date, you may need to change the payment amount. In such cases, you can manually change the payment in the system by posting the monetary transaction CHANGE PAYMENT AMOUNT on the Customer Service screen’s Maintenance link.
The approved amount for staged funding can be disbursed with the Funding screen or at a later time using the Advances screen. If the first disbursement is requested during funding, you may enter it on the Itemization sub screen of the Funding screen’s Contract screen.
If the entire approved amount is not disbursed during initial funding, it can be disbursed using the Advances screen’s Advance Entry screen.
If the initial amount on the Advance Entry screen is not within the minimum or maximum limits (as entered in the Advance Details section on the Setup Module screen’s Contract screen), the system displays any of the following error or warning messages in the Advances section’s Error Reason field:
-or-
The Advance Entry screen also allows you to enter subsequent funding / disbursements. If subsequent advances are not within the predetermined minimum or maximum amounts, the system displays any of the following warning or error messages in the Advances section’s Error Reason field:
-or-
If you attempt to post an advance after the draw end date, then the system displays the message in the Advances section’s Error Reason field as, "ADVANCE DT IS AFTER DRAW PERIOD END DATE".
If you attempt to post an advance above the approved amounts, including tolerance, the system displays the message in the Advances section’s Error Reason field as "ADVANCE AMOUNT IS MORE THAN THE TOTAL APPROVED AMOUNT INCLUDING TOLERANCE".
Since this is not a revolving loan, if any repayment is made against the approved amount principal balance, the system will not adjust the disbursed amount allowing for subsequent additional staged funding or advances.
Note
There is no change to the payoff quote functionality in the system. The system uses the actual amount of the advance(s) and any interest accrued since the date of the last payment or credit in the PAYOFF QUOTE VALID UPTO DATE value when the payoff quote is requested before the draw end date.
The Balances sub screen lists the balances that will be established when an account is booked and funded.
CAUTION: Please contact your Implementation Manager for changes to this section.
To set up the Balances
A brief description of the fields is given below:
Field: |
Do this: |
Balance Type |
Displays the balance type. |
Chargeoff Method |
Select the charge off method to determine how the outstanding amount of this balance type will be handled from the drop-down list, if the account becomes uncollectable and the product is charged off. |
Writeoff Method |
Select the write off method to determine how the outstanding amount of this balance type will be handled from the drop-down list, if the account is within the write off tolerance of being PAID. |
Reschedule Method |
Select the reschedule method to determine how the outstanding amount of this balance type will be handled from the drop-down list, if the account is rescheduled. |
Sort |
Specify the sort order of how account balances will appear on the Customer Service form’s Balance screen. |
Billed |
Check this box to indicate that outstanding amounts for this balance type are considered a part of the billed amount. This also determines whether payments applied to this balance type are considered when satisfying outstanding amounts due. |
Accrued |
Check this box to indicate that outstanding amounts for this balance type will be included when interest is accrued against the account. |
Non Performing Rollover |
Check this box to indicate that “non-performing” is used as an intermediary status on your general ledger prior to charge off and want to create balances for non-performing accounts for this balance type. Note: (The Non-Performing Rollover box applies only to Balance Types of Advance/Principal and Interest. For all other Balance Types, this box would be cleared). |
Non Performing Balance Type |
Select the balance type you want to rollover from drop-down list, if you select the Non-Performing Rollover box (Advance/Principal). |
Enabled |
Check this box to indicate that this balance type will be created when the account is booked and funded |
The system loads the currently defined balances for accounts.
If your organization maintains additional balances, contact your Implementation Manager for information regarding those balances.
With the Amortize Balances sub screen, you can select one or more balances to be amortized over the life of the loan. You can also define the amortization method.
To set up the Amortization Balances
A brief description of the fields is given below:
Field: |
Do this: |
Amortize Balance Type |
Select the amortize transaction type from the drop-down list. |
Amortization Method |
Select the amortization method used to calculate the net amortization amount from the drop-down list. |
Cost/Fee method |
Select the amortization cost/fee method. |
Sort |
Specify the sort sequence to define the order of the amortize balances. |
Enabled |
Check this box to enable the amortize balance to be created when the account is booked and funded. |
On the Itemizations sub screen, you can define the itemized components for each type of contract, indicate if it is required, and determine whether it has a positive or negative bearing on the contract itemization math. You can establish the following groups of itemization transactions:
Type |
Description |
Advance |
Total amount of the product that is not a part of financed fees; in other words, the total amount the customer requested to be advanced. |
Financed Fees |
Fees rolled into the principal balance of the product. Financed fees are also considered to be a part of the finance charge. |
Pre-Paid Fees |
Fees that are paid by the consumer prior to the funding of the loan. These fees are not rolled into the balance of the product but are considered as part of the finance charge and are included in the calculation of the APR. |
Producer |
Fees that are paid to or by the producer of the loan; for example, a fee that is being charged to the producer. These transactions will affect proceeds. |
Escrow |
Allows you to connect the actual escrow itemization with the escrow type and the funding transaction. |
To set up the Itemizations
A brief description of the fields is given below:
Field: |
Do this: |
Itemization |
Select the itemization from the drop-down list. |
Disbursement Type |
Select the disbursement type from the drop-down list. |
Transaction |
Select the funding transaction type from the drop-down list. |
Itemization Type |
Select the itemization type from the drop-down list. Notes: 1. On selecting the "Prefunding Txns" as itemization type, it indicates that this particular itemization expects a payment from the customer prior to funding. 2. The itemization type "Prefunding Txns" is available only for loans. |
Sort |
Specify the sort order to define the order of the itemization transactions. |
Sign |
If the itemized transaction increases the group balance, click +ve. -or- If the itemized transaction decreases the group balance, click -ve. |
Enabled |
Check this box to enable the itemization and indicate that this itemization transaction will be created when the account is booked and funded. |
Amortize Balance |
Select the amortize balance affected by this itemization transaction from the drop-down list. Note: Advance itemizations do not affect amortize balances. |
Refund Calculation Method |
Select the refund calculation method from the drop-down list |
Taxable |
Check this box, if the itemization type is taxable. However, note that the taxable option defined in Setup > Administration > System > Sale Tax screen will supersede with this preference. |
Seller Pmt |
Check this box to enable seller payment |
Escrow |
Select the escrow from the drop-down list. |
Itemization Formula |
Select the itemization formula description from the drop-down list. |
Refund Calculation Method |
Check this box to enable Refund calculation Method. |
Escrow Required |
If this is an escrow account, check this box to indicate that an escrow is required during the application process (though at that time the user can choose Opt Out to decline.) |
Discount. Rate |
Specify the discount rate for the itemization. |
Any fees that are defined in the contract are set up on the Fees sub screen. The system currently supports the following contract fees:
The Fees sub screen allows you to define those fees whose value and method of calculation are set at the time of the loan. As these amounts cannot be changed after the product is booked and funded, you should only set up fees here that will not change over the life of the loan. Individual contract fee types may be defined multiple times in order to create graduated fees.
Note
Certain fees, like late fees, can be set up at contract, as well as state level. In such cases, the contract fee, if present, is used first.
To set up the Fees
A brief description of the fields is given below:
Field: |
Do this: |
Type |
Select the fee type from the drop-down list. |
Txn Amt From |
Specify the lowest transaction amount or balance amount against which this contract fee definition may be applied. |
Gross Capitalized Cost From |
Specify the minimum value of gross capitalization cost. |
Method |
Select the method of calculating the fee to be assessed from the drop-down list. |
Frequency |
Select the frequency of calculating the fee to be assessed from the drop-down list. |
Min Amt |
Specify the minimum fee amount to be assessed. |
Max Amt |
Specify the maximum fee amount to be assessed. If you selected FLAT in the Method field, then this field is not used and is normally populated as $0.00. |
Percent |
Specify the fee percentage of the outstanding transaction amount to be assessed as a fee. This amount will be adjusted to fall within the Min Amount and the Max Amount. |
Enabled |
Check this box to create the selected contract fee when the account is booked and funded. |
This tab is enabled if you have selected LIFE BASED depreciation method in Contract Definition and allows to define depreciation rates slab.
To define Life Based Depreciation Rate Schedule
A brief description of the fields is given below:
Field: |
Do this: |
Period |
Specify the cycle period sequence for life based depreciation calculation. |
Duration |
Specify the tenure for which the rate slab is applicable. For example, if duration is 12, and depreciation convention frequency is Monthly, then rate slab is applicable for first 12 months. |
Depreciation % |
Specify the percentage of depreciation to be calculated during the above duration. |
Enabled |
Select the check box to enable the rate schedule. |
Edits ensure your organization’s guidelines are properly followed and that all exceptions are sent to the appropriate personnel to review.
You can configure your system so that during the origination process, at each change to an application’s status, the system will perform a set of edits on the Verification link’s Edits screen (found on the Application Entry, Underwriting, and Funding windows).
Edits ensure your organization’s guidelines are properly followed and that all exceptions are sent to the appropriate personnel to review. If the edits check fails, then the system will not allow the change of status, and the application will remain in its current status. This screen allows you to define the validations the system must perform on the Verification master tab, as the status of application changes.
Origination edits are used to validate applications entered through the standard Application Entry and Applications windows. The Edits screen contains two sections, the Edit Type Definition section and the Edit Sub Type Definition section.
To set up the Edits
You can either define new Edit Type Definition details or specify a new name in the New Edit Type field and click Create Copy to create a copy of selected edit type definition with details.
A brief description of the fields is given below:
Field: |
Do this: |
Edit |
Specify the edit name. |
Description |
Specify the description for the edit. |
Edit Type |
Select the edit type code from the drop-down list. |
System Defined |
Select ‘Yes’, if the entry is system defined. System defined entries cannot be modified. Select ‘No’, if the entry is not system defined and it can be modified. |
Enabled |
Check this box to enable the edit. |
Company |
Select the portfolio company associated with this edit, from the drop-down list. This may be ALL or a specific company. |
Branch |
Select the portfolio branch within the company associated with this edit, from the drop-down list. This may be ALL or a specific branch. This must be ALL if you selected ALL in the Company field. |
Channel |
Select the channel from the drop-down list, This can be ALL or a specific channel. |
Product |
Select the product associated with this edit, from the drop-down list. This may be ALL or a specific product. |
State |
Select the state with this edit from the drop-down list. This may be ALL or a specific product. |
Currency |
Select the currency associated with this edit, from the drop-down list. This may be ALL or a specific branch. |
A brief description of the fields is given below:
Field: |
Do this: |
Edit Sub Type |
Select the edit sub type for the edit, from the drop-down list. |
Edit |
Select the description for the edit, from the drop-down list. |
Result |
Select the result type for the edit, from the drop-down list. |
Enabled |
Check this box to enable the edit. |
Value |
Specify the expected value for the first edit. The Value field records the threshold value for the edit. The actual function of the entered value is dependent on the edit category. |
Override Responsibility |
Select the responsibility that can override the edit, from the drop-down list, if the edit result is an override. Designates the user responsibility level required to continue processing applications that fail the edit based on the Value field. You may define the same edit multiple times with a Result = OVERRIDE and different Value and Override Responsibility combinations to encompass various results. |
System Defined |
Select ‘Yes’, if the entry is system defined. System defined entries cannot be modified. Select ‘No’, if the entry is not system defined and it can be modified. |
Using the Edit Type field of the Edit Type Definition section, you can define when you want the edits check to occur by selecting from the following list of edit types:
Edit type: |
Description: |
APP ENTRY EDITS |
Edits that normally run on Application Entry form. |
APP PRESCREENING EDITS |
Edits that run between application entry and the pulling of a credit bureau. These edits determine whether the application should be reviewed further, and whether a credit bureau should be pulled. |
PRE Qualify Edits |
Edits that run to check whether the minimum details which are required to prequalify the application are satisfied or not. |
APP AUTOMATIC APPROVAL EDITS |
Edits that run after a credit bureau has been pulled and scored. These edits determine whether an application should be automatically approved or declined. |
APP APPROVAL EDITS |
Edits that run whenever an application is manually changed to a status/sub status that indicates the application (in its current state) should be approved. |
APP DECLINE EDITS |
Edits that run whenever an application is manually changed to a status/sub status that indicates the application (in its current state) should be declined. |
APP CONTRACT EDITS |
Edits that run whenever an APPROVED or CONDITIONED-APPROVED application is about to be funded. These edits ensure the validity of the contract data. |
Each entry in the Edit Sub Type field is grouped into the following categories:
Origination edit sub types: |
Description |
ORIGINATION APPLICANT EDITS |
Edits that pertain to data entered for an applicant on an application. |
ORIGINATION APPLICATION EDITS |
Edits that pertain to data entered for the requested loan. |
ORIGINATION ASSET EDITS |
Edits that pertain to data entered for asset entered on the application. |
ORIGINATION CONTRACT EDITS |
Edits that pertain to data entered for the contract on the application. |
ORIGINATION CREDIT BUREAU EDITS |
Edits that pertain to data gathered from the credit bureau reports for the applicants on the application. |
ORIGINATION DECISION EDITS |
Edits that pertain to data required to make a decision on the application. |
Each entry in the Edit Sub Type field can be set up with more than one entry in the Description field. The purpose of specific edits fall into the following types:
Description starts with: |
(Edit Category) Description of Edit Category: |
CHD: |
(RECORD POPULATION EDITS) Check for the existence of an entire data record. |
DUPLICATE: |
(DUPLICATION EDITS) Check for duplication of existing data. |
RANGE: |
(VALUE RANGE/TOLERANCE EDITS) Check to determine whether data entered for a specific data field is within the specific tolerance. |
REQUIRED: |
(REQUIRED FIELD EDITS) Check to determine whether a specific data field has been populated within a data record. |
FLK: |
(LOOKUP VALUE EDIT) Check API entered data against the existence of that value in the related lookup types lookup codes. |
XVL: |
(CROSS VALIDATION EDIT) Check to determine whether specific field, or set of fields, value corresponds to a value obtained by calculating them from another field or set of fields (for example, Total Payments = Terms * Standard payment amount). |
An Edits check can produce one of three results: an Error, a Warning, or an Override.
Edit type: |
Results: |
Error |
The system will prevent you from proceeding when an edits check fails. The only option is to change the source data. The application will revert to its previous status/sub status. The user will be directed to correct the specific error. Until the edits that return an ERROR value are addressed, the user cannot continue processing the application. |
Warning |
When an edits check fails in these cases, the system allows the process to continue. Warnings serve as informational messages and can be ignored. The user will be notified that an edit failed, but the failure need not stop the current processing of the application. The user can either ignore the error, or have the application revert to its previous status/sub status and address the error before processing the application further. |
Override |
The edit check has failed; however, the system allows users with the responsibility specified in the Override Responsibility field to continue. Multiple override levels can be setup depending upon the resulting value of the edit. If the user has override responsibility, the application will process as if the edit had not failed. If the user does not have override responsibility, the application will revert to its previous status/sub status and the sub status changes to OVERRIDE REQUIRED. The system will then direct the application to a user with the authority to process the application. (See the Queues chapter for more information). |
Note
Do not set the Result field to Override for credit application edits.
Oracle Business Rules is a component of Oracle Application Server that enables applications to rapidly adapt to regulatory and competitive pressures. This increased agility is possible due to the adoption of Oracle Rule author wherein a lending Institution can create or change a business rule without having to indulge in coding and also without stopping the business process. Also, externalizing business rules allows to manage business rules directly, without involving programmers. It provides best of breed solutions that would help in configuring the rules very quickly by a business analyst or user with some insight on the database.
The Cycles screen allows you to define the origination workflow process of your organization. As you delineate the steps in the origination process, you will also define:
The following diagram displays the general concept of workflow:
Cycle code definitions drive the application cycle. The following pairs of status/sub status define status/sub statuses that have system defined meanings and should be included in your origination workflow, if they are not already included.
After entering the basic details of the applicant, you can check whether the application pre-qualifies or not. If the pre-qualified edits are satisfied, the status is changed to NEW-PREQUALIFY APPROVED and you can modify or update any further details in the Application Entry screen. If the edits are not satisfied, the application will be pushed to the REJECTED APPLICATIONS queue with a status update to REJECTED-PREQUALIFY REJECTED, then you can also view the rejected pre-qualification in the Underwriting window.
Note
The system status and sub status lists are predefined and cannot be changed by the administrator. If you require additional sub status codes, please contact Oracle Financial Services Software to determine whether they can be added.
Status/Sub status: |
Description: |
NEW-BLANK |
This is the status/sub status of applications during data entry. Applications remain NEW-BLANK until you choose the Next Application on the Application Entry form and the system successfully performs the application edits check. |
NEW-PRESCREEN |
The system processes the prescreen edits to determine whether a credit report should be pulled for this application or not. |
NEW-PRESCREEN APPROVED |
Applications in this status/sub status have passed the prescreen edits. The system will now request a credit bureau pull. |
NEW-PREQUALIFICATION |
The system checks the applicant details whether it is qualified or not. |
NEW-PREQUALIFY APPROVED |
If the pre-qualified edits are satisfied, the status is changed to NEW-PREQUALIFY APPROVED and you can modify or update any further details in the Application Entry screen. |
REJECTED-PREQUALFY REJECTED |
If the edits are not satisfied, the application will be pushed to the REJECTED APPLICATIONS queue with a status update to REJECTED-PREQUALIFY REJECTED. |
REJECTED-PRESCREEN REJECTED |
Applications in this status/sub status failed the prescreen edits. These applications will receive no further processing. The producer will be sent a decision fax and the consumer will receive an adverse action letter. |
NEW- REVIEW REQUIRED |
Either based on the scoring of the application’s credit bureau(s) pull, or the fact that a credit bureau report was not successfully obtained, the application needs to be reviewed by an underwriter. |
NEW- RECOMMEND APPROVAL |
Based on the scoring of the application’s credit bureau(s) pull, the application should be reviewed by an underwriter. However, based on the current setup, the system recommends approving this application. |
NEW- RECOMMEND REJECTION |
Based on the scoring of the application’s credit bureau(s) pull, the application should be reviewed by an underwriter. However, based on the current setup, the system recommends rejecting this application. |
APPROVED-AUTO APPROVED |
Based on the scoring of the application’s credit bureau(s) pull, the system automatically approves the application. The producer will be sent a decision fax, and the application will be passed to funding. |
REJECTED-AUTO REJECTED |
Based on the scoring of the application’s credit bureau(s) pull, the system automatically rejects the application. The producer will be sent a decision fax and the consumer will receive an adverse action letter. |
APPROVED-BLANK |
Application has been manually approved. Normally this occurs when an application is in the NEW- RECOMMEND APPROVAL, NEW- RECOMMEND APPROVAL status/sub status, or less often in the NEW- RECOMMEND REJECTION status/sub status. Any cycle code definition with next values of APPROVED-BLANK should have a lookup value of APP APPROVAL EDITS to ensure that all of the required data has been gathered in making the decision to approve the application (unless the application is currently in a status/sub status that assures the APP APPROVAL EDITS have been run). |
NEW-OVERRIDE REQUIRED |
A user without sufficient override authority attempted to approve an application, which, based on setup, required a higher over-ride authority to approve. |
APPROVED- VERIFYING |
Contract has been received from the producer. |
APPROVED-FINAL DOCUMENT CHECK |
The contract has been reviewed and the data is correct. Normally this occurs when an application is in APPROVED-FINAL DOCUMENT CHECK or CONDITIONED-FINAL DOCUMENT CHECK status/sub status. Any cycle code definition with next values of APPROVED-FINAL DOCUMENT CHECK or CONDITIONED-FINAL DOCUMENT CHECK should have a value of APP CONTRACT EDITS to ensure that all of the required data has been gathered in making the decision to approve the application, unless the application is currently in a status/sub status that assures the APP CONTRACT EDITS have run. |
APPROVED-VERIFIED |
The application has been processed and is awaiting funding. |
APPROVED-FUNDED |
The application has been funded, and a check requisition has been created. If Customer Service form is being used, then an account is also created at this time. |
REJECTED-BLANK |
The application for whatever reason is being manually rejected regardless of its current status/sub status. Any cycle code definition with Next values of REJECTED-BLANK should have a lookup value of APP DECLINE EDITS to ensure that all of the required data has been gathered in making the decision to approve the application (unless the application is currently in a status/sub status that assures the APP DECLINE EDITS have run). |
WITHDRAWN-BLANK |
The applicants have indicated that they are no longer pursuing this loan. |
CONDITIONED-<ANY> |
These status/sub status pairs are analogous to the corresponding APPROVED-<ANY> pair and indicate that the application has had additional conditions placed on its approval. |
<ANY>-<ANY OVERRIDE> |
Requires OVERRIDE approval. The meaning of the sub status is analogous to the corresponding OVERRIDE sub status, and may require that specific EDITS run before proceeding. |
<ANY>-AGED APPLICATION |
These applications have been decisioned but no contract has been received after a period of time determined by setup. If not acted on, these applications will become VOID. |
<ANY>-AGED CONTRACT |
Contracts have been received after a period of time determined by setup. If not acted on these applications will become VOID. |
<ANY>-VOID |
Indicate application previously had a sub status of AGED CONTRACT or AGED APPLICATION. These applications have not been completed and were made VOID after another period of time had passed. |
Using these status and sub status, let us re-examine the early workflow diagram in this section.
Note
It is extremely important that the APP CONTRACT EDITS run prior to an application being funded. All cycle code definitions should be reviewed to ensure that there are no paths through the origination cycle that bypass this EDIT type.
To set up the Cycles
A brief description of the fields is given below:
Field: |
Do this: |
Cycle |
Specify the cycle code. |
Type |
Displays the cycle type. |
Product |
Select the product from the drop-down list. |
A brief description of the fields is given below:
Field: |
Do this: |
Current Code |
Select the current code to transition FROM, from the drop-down list. |
Current Sub Code |
Select the current sub code to transition FROM, from the drop-down list. |
Next Code |
Select the current code to transition TO from the drop-down list. |
Next Sub Code |
Select the next sub code to transition TO, from the drop-down list. |
Origination Stage Code |
Select the origination stage code of the application from the adjoining drop-down list. |
Edit Type |
Select the edit type to associate to the cycles, from the drop-down list. |
A brief description of the fields is given below:
Field: |
Do this: |
Responsibility |
Select the responsibility that will be capable of executing this transition, from the drop-down list. |
Allowed |
Select ‘Yes’ to allow change to the status responsibility and ‘No’ to disallow. |
The Scoring screen allows you to setup individual and multiple scoring models. You can define different scoring models by company, branch, currency and product. Scoring models are used to automate the decisioning process during underwriting and grade applications.
When you complete the Application Entry process, the system determines which scoring model to use by finding a best match. The system searches the Company, Branch, Currency and Product fields of all enabled scoring models that contain either the exact value on the application or ALL. (Exact matches for each field are given a higher weight than matches to ALL.) The system then ranks the returned matches in descending order, based on the weighted values and the hierarchical position of the field and then by Start Date. The system recognizes the first row returned as the best match. This scoring model information is then used to determine the next status and sub status of the application.
If you use a standard bureau score as a scoring model, you can set up the system to use the adverse action reasons provided by the standard bureau score on the Stipulations sub screen.
To set up the Scoring
You can either define new Credit Score Model or specify a new name in the New Credit Model field and click Create Copy to create a copy of selected score model with details.
A brief description of the fields is given below:
Field: |
Do this: |
Results section |
|
Max Score |
Specify the maximum score allowed. (This is normally the sum of the Max Value fields within the scoring parameters.). |
Selection Criteria section |
|
Company |
Select the company for the scoring model, from the drop-down list. This may be ALL or a specific company. |
Branch |
Select branch within the company for the scoring model, from the drop-down list. (This may be ALL or a specific branch. However, if you have selected ‘ALL’ in Company field, then you must select ‘ALL’ for this field). |
Product |
Select the product for the scoring model, from the drop-down list. This may be ALL or a specific product. |
Currency |
Select the currency for the scoring model, from the drop-down list. This may be ALL or a specific currency. |
Bureau Score Reasons |
Check this box to use the score reasons supplied by the credit bureau. If unchecked, then automatically rejected applications scored using this scoring model display the Adverse Action Reasons from the Parameters sub screen. |
Auto Decision |
Check this box to assign an application, a status/sub status based on the grade associated with the score returned for this scoring model. If not selected, the system assigns applications scored using this scoring model a status/sub status of NEW-REVIEW REQUIRED. |
Model |
Specify the code for the scoring model. |
Description |
Specify a description of the scoring model. |
Start Dt |
Specify the start date for the scoring model. You can even select the date from the adjoining Calendar icon. |
End Dt |
Specify the end date for the scoring model. You can even select the date from the adjoining Calendar icon. |
Enabled |
Check this box to enable the scoring model. |
The Parameters records the parameters used to determine the score calculated by the scoring model. You can define multiple parameters and adverse action reason associated with each parameter in a scoring model. Each scoring parameter can have maximum values set. The score range is based upon the information in the Range Definition section on the Parameters sub tab.
The system calculates a final score by adding the score for each parameter in the scoring model. A parameter weighted value is used to find the four adverse action reasons, if bureau reasons are not used.
Note
A character parameter range definition should contain the exact value of the parameter.Each scoring parameter should have range definitions defined that encompass all of the values that might result.
A brief description of the fields is given below:
Field: |
Do this: |
Parameter |
Select the parameter from the field, from the drop-down list. |
Max Value |
Specify the maximum value allowed for the selected parameter. |
Adverse Action Reason |
Select the adverse action reason, from the drop-down list. (If, on the Scoring Models screen, the Bureau Screen check box is checked for the scoring model, you cannot update this field). |
Weighted Value |
Specify the adverse action weighted value. This indicates the priority of this parameter when determining which adverse action reasons to use on the application. The top ten adverse action reasons based on the weighted value of the parameter will be populated. |
Enabled |
Check this box to enable the parameter. |
A brief description of the fields is given below:
Field: |
Do this: |
Value From |
Specify the lowest calculated value to apply the specific translation. The ceiling of the range definition is based on the range definition with the next highest Value From or the Max Value of the scoring parameter (whichever is less). |
Value From |
Select the following options to determine how values for a scoring parameters are translated: % Max Value – If selected, then the calculated values within the range definition receives a value based on a percentage of the Max Value of the scoring parameter. % Param – If selected, then the calculated values within the range definition receives a value based on a percentage of the calculated value of the scoring parameter. Value – If selected, then the calculated values with in the range definition receives a specific value. |
Percent / Value |
Specify the percent or value to be used in the translation of the calculated value of the scoring parameter. |
Enabled |
Check this box to consider this range definition while translating values for this scoring parameter. |
The Grades sub screen allows you to define how the system translates the scoring model scores into your organization’s grade. The system uses these grades in the auto-decisioning process. Each grade has a specific status/sub status that informs the system what to do with the application of a particular grade as it continues through the origination cycle.
Note
Each scoring model should have grade definitions defined that encompass all of the values that might result.
A brief description of the fields is given below:
Field: |
Do this: |
Score |
Specify the score the application receives. |
Credit Grade |
Select the grade to assign to an application, from the drop-down list. |
Application Status |
Select the status to assign to applications with a score starting with the value of this grade definition, from the drop-down list. |
Sub Status |
Select the sub status to assign to applications with a score starting with the value of this grade definition, from the drop-down list. Credit scoring allows you to select the following status/sub status pairs: APPROVED - AUTO APPROVED REJECTED - AUTO REJECTED NEW - REVIEW REQUIRED NEW - RECOMMEND APPROVAL NEW - RECOMMEND REJECTION. |
Enabled |
Check this box to indicate that this grade definition will be considered when grading an application using this scoring model. |
The Fee screen allows you to define fees that may be automatically assessed by the system. The Fee Definition section records fees not defined within the Contract screen’s Fees sub screen.
The following fee types are currently supported for automatic assessment:
Fees can be calculated as either a flat amount or a percentage of payment due based on fee type.
You can specify minimums and maximums for fee amounts in the Min Amt and Max Amt fields. Different fee rules can be setup at the company/branch level.
When Fees are assessed, the system determines the best match using all enabled fee definitions that meet the following criteria:
The returned rows are then given a descending rank based on the weighted values and the hierarchical position of the following criteria:
On the ranked rows, the first row is returned as the best match.
Note
Certain fees, like late fees, can be set up at contract, as well as state level. In such cases, the contract fee, if present, is used first. Only if the contract fee is not present in the state fee used.
To set up the Fee
A brief description of the fields is given below:
Field: |
Do this: |
Fee Rule |
Specify the fee rule used to identify the particular fee definition. |
Fee Type |
Select the fee type from the drop-down list. The system computes these drop-down values from the TXN_TYPE_CD Lookup, with FEE as the sub type. |
Start Dt |
Specify the start date. You can even select the date from the adjoining Calendar icon. |
End Dt |
Specify the end date. You can even select the date from the adjoining Calendar icon. |
Enabled |
Check this box to enable the fee. |
Calc Method |
Select one of the following method of calculating the fee, from the drop-down list. If ‘Flat Amount' is selected, then minimum fee will be charged. If ‘Percentage’ is selected, then the amount charged will be based on percentage defined subject to minimum and maximum amount (i.e. 'Txn Amt From'). |
Min Amt |
Specify the minimum amount for the fee. |
Max Amt |
Specify the maximum amount for the fee. If you selected FLAT amount in the Calc Method field, then this field is not used and is normally populated as $0.00. |
Percent |
Specify the percentage value of the outstanding transaction amount to be assessed as a fee. This amount will be adjusted to fall within the Min Amount and the Max Amount. |
Selection Criteria section |
|
Company |
Select the portfolio company from the drop-down list. This may be ALL or a specific company. |
Branch |
Select the portfolio branch from the drop-down list. This may be ALL or a specific branch. (This must be ALL, if you have selected ‘ALL’ in the Company field). |
Channel |
Select the channel from the drop-down list, This can be ALL or a specific channel. |
Product |
Select the product from the drop-down list. This may be ALL or a specific product. The available values come from a validated field based on the selected Billing Cycle setup and the Product setup. |
State |
Select the state for this fee, from the drop-down list. This may be ALL or a specific state. |
Currency |
Select the currency for this fee, from the drop-down list. This may be ALL or a specific currency. |
Txn Amt From |
Specify the transaction or balance amount. The fee is calculated using the specifications of this record only if the transaction amount is greater than the value specified in this field (and less than this field in another record for the same fee). IMPORTANT: When you select the fee to use, the system searches for a best match using the following attributes: 1 Company 2 Branch 3 Product 4 State 5 Amount (Txn Amt From) 6 Effective/start date (Start Dt) Hence, Oracle Financial Services Software recommends creating a version of each fee, where ALL is the value in the these fields. It is also recommended that you define a default printer for an Organization, Division and Department. |
Gross Capitalized Cost From |
Specify the minimum value of gross capitalization cost. |
In Asset Billing Rate screen you can setup the various parameters associated with ‘Home’ collateral which serves as the input for ‘Asset Billing’ batch job to process and post the dues on to respective accounts in the system.
The chapter consists of following sections:
In the Asset Billing Rate Definition tab you can create and maintain ‘Timeshare’ specific Home collateral and account details of an account which are used as a selection criteria.
To set up Asset Billing Rate Definition
In this field: |
Do this: |
Name |
Enter a unique name for Asset Billing Rate definition. This field is not editable after saving the record or during EDIT. |
Description |
Enter the description for Asset Billing Rate definition. |
Enabled |
Check this box to enable the record. |
Selection Criteria |
|
Company |
Select the portfolio company from the drop-down list. This list is populated based on Enabled Company definitions maintained in the system. |
Branch |
Select the portfolio branch from the drop-down list. |
Product |
Select the type of product associated with the collateral from the drop-down list. |
State |
Select the state to which the account operates from the drop-down list. |
Channel |
Select the channel from the drop-down list. |
Asset Type |
Select asset type from the drop-down list. The list is populated based on assets setup. |
Asset Sub Type |
Select the asset sub type from the drop-down list. |
Club Name |
Select the Club Name from the drop-down list. |
Phase Number |
Select the Phase Number from the drop-down list. |
Site of Inventory |
Select the Site of Inventory from the drop-down list. |
Building |
Select the Building from the drop-down list. |
Unit |
Select the Unit from the drop-down list. |
Week |
Select the Week from the drop-down list. |
Room/Unit Type |
Select the Room/Unit Type from the drop-down list. |
Usage Type |
Select the Usage Type from the drop-down list. |
Resort Identifier |
Select the Resort Identifier from the drop-down list. |
Min Points |
Specify the minimum points for the asset billing definition. |
Max Points |
Specify the maximum points for the asset billing definition. |
Association Id |
Select the Association Id from the drop-down list. |
Club Indicator |
Check this box to indicate Club Indicator. |
Plus Membership Type |
Check this box to indicate Plus Membership Type. |
PR Marking |
Check this box to indicate PR Marking. |
Signature Grand Father |
Check this box to indicate Signature Grand Father. |
Additional Attributes - This section consists of additional 15 configurable fields as indicated below 5 check boxes - Membership 1-5 Opt 5 drop-down lists - Other Attribute 1-5 5 Calendar fields - Other Attribute 5-10 |
In the Asset Billing Details sub tab, you can define Transactions, their Calculation Method, and other parameters which are posted by Billing Batch Job.
Note that once a record is created in this section, the same is available in Read-Only mode and you can only Enable or Disable the record in Edit mode.
To set up Asset Billing Rate Details
In this field: |
Do this: |
Start Date |
Select the date of asset billing from adjoining calendar. |
Transaction |
Select the transaction from the drop-down list. This list is populated with transactions where the Transaction code = FOTH%. |
Calc Method |
Select one of the following calculation method from drop-down list. - Flat Amt - Rate - Flat Amt + Rate - Tiered Rate - Slab Formula For more information on above calculation methods, refer to ‘Asset billing Calculations’ section. |
Flat Amt |
Specify the flat amount or fixed amount to be charged during asset billing calculation. This field is available if the Calc Method is Flat Amt, Flat Amt + Rate, and Slab based Formula. |
Rate |
Specify the rate for asset billing calculation. This field is available if the Calc Method is Rate and Flat Amt + Rate. |
Frequency |
Select the frequency of asset billing calculation from the drop-down list. The list is populated based on frequency maintained in lookup code. |
% of Calc Amt |
Specify the percentage of amount for calculation. By default, this is set to 100. |
Base Points |
Specify the base points for asset billing calculation. By default this is set to 1 since a value is required system does not allow to enter ‘0’. This field is available if the Calc Method is Rate, Flat Amt + Rate, Tiered Rate, and Slab Formula. |
Slab Points |
Specify the slab points for asset billing calculation. This field is available if the Calc Method is Slab Formula. |
% Increase |
Specify the percentage increase in each slab for asset billing calculation. This field is available if the Calc Method is Slab Formula. |
Min Amt |
Specify the base minimum amount to be configured for the resulted transaction amount. If the resulted Transaction Calculation Amount is less than the Min Amt defined here, system posts the transaction with Min Amt. |
Max Amt |
Specify the maximum amount to be configured for the resulted transaction amount. If the resulted Transaction Calculation Amount is greater than the Max Amt defined here, system posts the transaction with Max Amt. |
Billing Year |
Specify the year in which the Rate is applicable. The Billing Year is stamped in billing amount transaction description only for FOTH% transactions. |
Enabled |
Check this box to enable the Asset Billing Rate. |
The Tiered Rate Details sub tab you can define ‘points’ specific tiers with different rates. This sub tab is enabled only if the transaction calculation method is selected as ‘Tiered Rate’ in Asset Billing Rate Details section. For calculation details, refer to ‘Tiered Rate Calculation’ section.
To set up Tiered Rate Details
In this field: |
Do this: |
From Points |
Specify the points from where the respective rate is applicable. |
Rate |
Specify the rate for defined points range. |
Enabled |
Check this box to enable Tiered Rate detail |
This section explains the following calculation methods based on which the Asset Billing is processed in the system:
In ‘Flat Amount’ calculation, system calculates the Transaction Amount using below formula:
Frequency |
Billing Cycle |
Transaction Amount Calculation |
Annual |
Monthly |
(Flat Amt/12) |
Monthly |
Annual |
(Flat Amt*12) |
Annual |
Quarterly |
(Flat Amt/4) |
Quarterly |
Annual |
(Flat Amt*4) |
Annual |
Semi Annual |
(Flat Amt/2) |
Semi Annual |
Annual |
(Flat Amt*2) |
Annual |
Annual |
(Flat Amt /1) |
Consider the above calculation as reference for other combinations of Rate Frequency and Billing cycle.
In ‘Rate’ calculation, system calculates the Transaction Amount using below formula:
Frequency |
Billing Cycle |
Transaction Amount Calculation |
Annual |
Monthly |
(Rate/12)*(Billing Points at collateral / Base Points) |
Monthly |
Annual |
(Rate*12)*(Billing Points at collateral / Base Points) |
Annual |
Quarterly |
(Rate/4)*(Billing Points at collateral / Base Points) |
Quarterly |
Annual |
(Rate*4)*(Billing Points at collateral / Base Points) |
Annual |
Semi Annual |
(Rate/2)*(Billing Points at collateral / Base Points) |
Semi Annual |
Annual |
(Rate*2)*(Billing Points at collateral / Base Points) |
Annual |
Annual |
(Rate/1)*(Billing Points at collateral / Base Points) |
Consider the above calculation as reference for other combinations of Rate Frequency and Billing cycle.
In ‘Flat Amt + Rate’ calculation, system calculates the Transaction Amount using below formula.
Transaction Amount = Flat Amt + Rate * (Billing Points at Collateral/Base Points)
Note
The Rate and Flat amount are adjusted based on Frequency and Billing Cycle.
In ‘Tiered Rate’ calculation, system selects the ‘Asset Billing Rate Details’ using the Billing Points at Asset and other asset parameters and calculates the transaction amount by deriving the rate from Tiered Rate table.
Transaction Amount = (Tiered Rate) * (Tiered Points / Base Points)
For example, if an Asset has 1.5 million points and the range is maintained as - for first million points rate=0.66 with Base Points =1000 and for remaining points rate=0.60 with Base Points = 1000, the Transaction Amount = 1million * (0.66/1000) + 0.5 million * (0.6/1000) = 660 + 300 = 960.
Note the following:
For example, if Billing Points are 8000 but if range maintained points is from 10000 with Rate = 0.55 and Base Points = 1, the transaction amount results as (0*(8000/1) =0).
In ‘Slab Formula’ calculation, system calculates the Transaction Amount using below formula.
Transaction Amount = [Flat Amt] + Ceil[\{Billing Points - Base Points)/Slab Points}*\{%Increase / 100)*Flat Amt}]]
The resultant amount will always be rounded-up.
For example,
Transaction Amount = [491.32+[{(61000-5000)/2500}*{(30.4/100)*491.32}]]
= [491.32+ [Round-up {22.4}*{149.36}]]
= [491.32+3435.28]
Transaction Amount = 3926.6
Note
The Rate and Flat amount are adjusted based on Frequency and Billing Cycle.
The data in Asset Billing Rate screen can also be created and updated from an external file through SET-IFP input file upload process. While doing so, ensure that the file format of Header and Details record are maintained in required order and the input file is placed in upload area.
During the scheduled batch job run, the asset billing batch job picks-up the data in input file and loads on to the system to create Asset Billing Rate setup records.
However, before processing the details, system performs the following validations:
The billing batch job TXNDDT_BJ_100_01 (BILLING/DUE DATES PROCESSING) facilitates to process the asset billing dues on account for ‘Home’ collateral and posts the corresponding transactions.
Listed below is the sequence of processing steps:
Before the due calculation, batch job validates VO parameters with the following:
If First Due Date = 01/01/2018, Usage Start Date = 01/10/2018,
Prorated Points = Billing Points * (13-1)/12= Billing Points *1
If First Due Date = 01/01/2018, Usage Start Date = 03/10/2018
Prorated Points = Billing Points * (13-3)/12= Billing Points*10/12
Note: Number ‘13’ here is used as constant.
On posting the transactions, following validations and outcome are handled:
The system supports the auto computation of origination itemized fees. System administrators can define and maintain the itemization formula on the Origination Fees screen.
An itemization formula can be set up as a computation of other itemizations (such as adding or subtracting one itemization from another) and can consist of multiple itemizations. An itemization formula will have a minimum and maximum value. You can set up a formula value range to be used as the final value.
Itemizations are linked to a product with the Products screen’s Product Itemizations subtab.
One itemization can be based on one formula, while the same formula can be attached to multiple itemizations. If a formula is attached to a contract itemization and that formula requires an itemization not present in Formula Definitions screen, then the system displays an error message.
The system will search for any “circular dependency” at the time the contract is enabled. An example of a circular dependency is when Itemization1 has Formula1 attached requiring Itemization2 for computation and Itemization2 has Formula2 attached requiring Itemization1 for computation.
To set up the Origination Fees
Field: |
Do this: |
Formula |
Specify the formula code to define computation. |
Description |
Specify the description for the formula. |
Min Amt |
Specify the minimum value that should be considered to compute the final value of formula. |
Max Amt |
Specify the maximum value that should be considered to compute the final value of formula. |
Enabled |
Check this box to allow the origination fees. |
A brief description of the fields is given below:
Field: |
Do this: |
Itemization |
Select the itemization based on which the itemization formula will derive its computed value, from the drop-down list. |
Percentage |
Specify the percentage value that should be considered while computing value for itemization formula. |
Sort |
Specify the sort sequence for the itemization to be considered while computing the value of the itemization formula. |
Sign |
Select the +ve or -ve sign that needs to be considered between two itemizations for computing the value of the itemization formula. |
Enabled |
Check this box to allow the itemization details to be used by the system. |
A brief description of the fields is given below:
Field: |
Do this: |
Amt From |
Specify the value up to which the percentage of final value of the itemization formula to be considered for the final value of itemization formula. |
Percent |
Specify the percentage value that should be considered while computing the value for the final value of the itemization formula. |
Enabled |
Check this box to allow the range details to be used by the system. |
With the Compensation screen, you can define compensation plans for producers who supply the financial institution with applications for Lease. These compensation plans can be set up at various levels depending upon your organization’s needs.
This information is used on the Compensation sub tab on the Origination > Application > Contract tab. The Compensation Plan field lists the plans available based on the contract in use for the application. When you click Load on the Compensation sub tab, the system adds the information setup on the Compensation screen.
Compensation can be paid to a producer in a number of ways:
Payment calculation method: |
Description: |
AS EARNED |
The compensation amount is paid out in pieces over the life of the product based upon the interest earned. |
PAY AS U GO |
The compensation amount is paid out in pieces over the life of the product based upon the interest received by virtue of the payment. |
UPFRONT |
The entire compensation amount is paid at the time of booking the Lease. |
UPFRONT MONTH END |
The entire compensation amount is paid at the month-end of booking the Lease. |
UPFRONT MONTH END (amortize spread formula) |
The amount financed will be amortized at a rate equal to the difference between the contract rate and buy rate. The finance charge thus derived would be considered the base compensation amount. the system then allows this base compensation to be split into two components: 1) Upfront compensation amount 2) Remaining compensation amount. The disbursement method will apply to the remaining compensation portion (total compensation minus the upfront amount). |
Compensations can be charged back from a producer, if a product is prematurely paid or charged off. The charge back amount can be calculated using the following methods:
You can specify whether the unearned portion or a certain percentage of the total compensation is to be charged back in case of early payoff or charge off.
The period for which the charge back plan can remain active can be set up according to:
To set up the Compensation
A brief description of the fields is given below:
Field: |
Do this: |
Code |
Specify the compensation code. |
Description |
Specify a description of the compensation plan being defined. |
Start Dt |
Specify the start date for the compensation plan. You can even select the date from the adjoining Calendar icon. |
End Dt |
Specify the end date for the compensation plan. You can even select the date from the adjoining Calendar icon. |
Enabled |
Check this box to enable the compensation plan. |
Result section |
|
Disbursement Method |
Select the method for calculating the compensation disbursement to be paid, from the drop-down list. |
Formula Method |
Select the type of formula to be used to calculate the compensation to be paid, from the drop-down list. The system uses following formula methods: FLAT AMOUNT - Flat amount is paid. MARKUP BASE FORMULA - A formula based on the markup between the buy rate and the interest rate offered to the consumer is used. PERCENTAGE OF ASSET COST - To calculate the compensation based on percentage of asset cost using the below formula. Compensation Amount = (Adjusted Capitalized Cost) * (Max Markup Percentage / 100) * (Factor / 100) * (Additional Factor / 100); |
Formula |
Select the formula to be used to calculate Compensation, from the drop-down list. The list is sorted with available option based on Formula method selected. |
Factor |
Specify the compensation factor; that is, the percentage applied to the compensation to be paid. If this value is not 100.00, it will reduce the compensation amount. |
Addl Factor |
Specify the additional compensation factor. If this value is not 100.00, it will further reduce the compensation amount. |
Max Markup Or Percent |
Specify the maximum compensation Markup. This limits the Markup on which compensation will be paid. |
Flat Amt |
Specify the flat compensation amount. |
Upfront% |
Specify the percentage of the compensation allocated upfront. |
Paid Off Method |
Select the method of the compensation that will be recovered by the producer, from the drop-down list, if the amount is paid early,. |
Paid Off Basis |
Select the basis used to determine the amount of compensation to be recovered from the producer, from the drop-down list, if the amount is paid early. |
Paid Off Days |
Specify the number of days in which the compensation can be recovered, if the Basis is selected as Days. |
Paid Off Term |
Specify the term in which the compensation can be recovered, if the Basis is selected as Term. |
Paid Off Percent |
Specify the percent of the compensation that will be recovered by producer, if the amount is paid off. |
Charge off Method |
Select the method of the compensation that will be recovered by the producer, from the drop-down list, if the amount is charge off. |
Charge off Basis |
Select the basis used to determine the amount of compensation to recover from the producer, from the drop-down list, if the product is charged off as uncollectable. |
Charge off Days |
Specify the number of days in which compensation can be recovered, if the Basis is DAYS. |
Charge off Term |
Specify the number of terms in which compensation can be recovered, if the Basis is TERM. |
Charge off Percent |
Specify the percent of the compensation that will be recovered by producer if the account is charged off as uncollectable, and the charge off basis is PERCENTAGE. |
Selection Criteria section |
|
Company |
Select the portfolio company, from the drop-down list. This may be ALL or a specific company. |
Branch |
Select the portfolio branch within the company for the selected compensation plan, from the drop-down list. This may be ALL or a specific branch. This must be ALL if in the Company field you selected ALL. |
Billing Cycle |
Select the billing cycle for the compensation plan, from the drop-down list. |
Product |
Select the product for the selected compensation plan, from the drop-down list. This may be ALL or a specific product. The available values come from a validated field based on the selected Billing Cycle setup and the Product setup. |
State |
Select the state for the selected compensation plan, from the drop-down list. This may be ALL or a specific state. |
Currency |
Select the currency for the selected compensation plan, from the drop-down list. This may be ALL or a specific currency. |
Pro Group |
Select the producer group for the compensation plan, from the drop-down list. This may be ALL or a specific producer group. |
Pro Type |
Select the producer type for the compensation plan, from the drop-down list. This may be ALL or a specific producer type. |
Producer |
Select the producer for the compensation plan, from the drop-down list. This may be ALL or a specific producer. The available values come from a validated field based on the Pro Group and Pro Type. |
Grade |
Select the credit grade for this compensation plan, from the drop-down list. This may be ALL or a specific grade. |
Amt |
Specify the minimum amount financed for the compensation plan. |
Term |
Specify the minimum term for the compensation plan. |
Asset Class |
Select the asset class for the compensation plan, from the drop-down list. This may be ALL or a specific asset class. The available values come from a validated field based on the Collateral Type. |
Asset Type |
Select asset type for the compensation plan, from the drop-down list. This may be ALL or a specific asset type. The available values come from a validated field based on your assets setup. |
SubType |
Select the asset sub type for this compensation plan, from the drop-down list. This may be ALL or a specific asset sub type. The available values come from a validated field based on your assets setup. |
Asset Make |
Specify the asset make from the drop-down list. If ALL was selected for either Asset Type or Asset Sub Type, then ALL will be the only available selection for the asset make. |
Asset Model |
View the asset model from the drop-down list. If ALL was selected for either Asset Type or Asset Sub Type, then ALL will be the only available selection for the asset model (display only). |
Age |
Specify the asset age. |
The Commission screen allows you to calculate dealer commissions for additional products (for example, life insurance and disability insurance) for loans sold by the dealer and entered in the Itemization sub screen during loan origination. You can setup the various commission plans, which you use or select during funding.
In addition to the criteria, you can also define the insurance itemization, as well as the commission itemization for which the plan is valid.
You can select one of the following two system-defined methods to calculate the commissions:
To set up the Loan Commission Plan
A brief description of the fields is given below:
Field: |
Do this: |
Code |
Specify the commission code. |
Description |
Specify the commission plan description. |
Start Dt |
Specify the start date associated with the commission. You can even select the date from the adjoining Calendar icon. |
End Dt |
Specify the end date associated with the commission. You can even select the date from the adjoining Calendar icon. |
Enabled |
Check this box to enable the compensation plan. |
Results section |
|
Calculation Method |
Select the commission calculation method as either ‘Flat Amount’ or ‘Percentage of Itemization Amount’ from the drop-down list. |
Value |
Specify the commission value. |
Commission Itemization |
Select the commission itemization from the drop-down list. |
Selection Criteria section |
|
IMPORTANT: When you select commission to use, the system searches for a best match using fields in this section. Hence, Oracle Financial Services Software recommends creating one version of each compensation where ALL is the value in these fields when you have the option. |
|
Company |
Select the portfolio company associated with the commission, from the drop-down list. |
Branch |
Select the portfolio branch associated with the commission, from the drop-down list. |
Billing Cycle |
Select the billing cycle associated with the commission, from the drop-down list. |
Product |
Select the product associated with the commission, from the drop-down list. |
State |
Select the state associated with the commission, from the drop-down list. |
Currency |
Select the currency associated with the commission, from the drop-down list. |
Pro Group |
Select the producer group associated with the commission, from the drop-down list. |
Pro Type |
Select the producer type associated with the commission, from the drop-down list. |
Producer |
Select the producer associated with the commission, from the drop-down list. |
Grade |
Select the credit grade associated with the commission, from the drop-down list. |
Amt |
Specify the minimum itemization amount associated with the commission. |
Term |
Specify the minimum insurance, warranty term associated with the commission, from the drop-down list. |
Asset Class |
Select the asset class associated with the commission, from the drop-down list. |
Asset Type |
Select the asset associated with the commission, from the drop-down list. |
SubType |
Select the asset sub type associated with the commission, from the drop-down list. |
Asset Make |
Select the asset make associated with the commission, from the drop-down list. |
Asset Model |
Select the asset model associated with the commission, from the drop-down list. |
Age |
Specify the asset age associated with the commission. |
Ins/Warranty Itemization |
Select the insurance or warranty itemization associated with the commission, from the drop-down list. |
Most financial institutes offer financing for insurance to the borrowers; examples include credit life, credit disability, and GAP. The insurance product offer permits the customer to cancel the insurance in mid term or automatically end when the product matures or is paid-off. The system supports financing of insurance products during origination and automatically end the insurance when the product is paid-off. The system also can compute the rebate premium based on “Rule of 78” or “Actuarial” method. As the customer might cancel the insurance in mid term of the loan, the system computes the premium rebate on a prorate basis. This also applies to additional insurance purchase during the life of the loan. Normally, mid term insurance cancellations have associated fees and grace period. In such cases, the customer may cancel the insurance during the grace period without accruing any fees. However, when a customer cancels after the grace period, the result is a predefined fees which the system deducts from the computed rebate.
The system supports mid term insurance cancellation with and without grace period and cancellation fees. With this enhancement of insurance processing, you can define the premium rebate computation with a prorate basis.
You can define financed insurance related itemizations in the Origination Fees screen, as you have in previous releases with the Insurance screen. You can also set the refund method to “Pro Rate Basis” in the Refund Method field in the Contract Itemization section on the Itemization sub screen during setup with the on the Contracts screen.
To set up the Insurances
You can either define new Insurance details or specify a new code in the New Insurance field and click Create Copy to create a copy of selected insurance with details.
A brief description of the fields is given below:
Field: |
Do this: |
Code |
Specify the code associated with the insurance product. |
Description |
Specify a brief description of the insurance product. |
Start Dt |
Specify the date from which you can start offering the product to customers. You can even select the date from the adjoining Calendar icon. |
End Dt |
Specify the date from which to stop offering the product to customers. You can even select the date from the adjoining Calendar icon. |
Enabled |
Check this box to allow the offering of this insurance product. |
Result section |
|
Insurance Type |
Select the insurance types available for financing, from the drop-down list. |
Insurance Company |
Specify the name of the company through which the insurance product is offered. |
Cancellation /Refund Allowed |
Check this box to allow the insurance rebate or refund for cancellation or paid-off. |
Grace Days |
Specify the number of grace days allowed for cancellation without charging a cancellation fee. |
Refund Calculation Method |
Select the insurance premium refund/rebate calculation method to be used when insurance is cancelled, from the drop-down list. |
Cancellation Fee |
Specify the amount of the cancellation fee to be charged when the insurance is cancelled. |
Grace Day's Cancellation Fee Allowed |
Check this box to allow cancellation fees during grace period. |
Deduct Fee From |
Select one of the followings option from the drop-down list to deduct the cancellation fee: Premium amount - which is deducted upfront before computation Rebate amount - which is deducted after computation |
Selection Criteria Section |
|
Company |
Select the portfolio company that can offer the insurance product, from the drop-down list. Select ALL if offered by all companies. |
Branch |
Select the branch of the specified portfolio company that can offer the insurance product, from the drop-down list. Select ALL if offered by all the branches of the specified portfolio company. |
Product |
Select the product for which you can offer the insurance product, from the drop-down list. Select ALL if offered for all the products. |
State |
Select the state for which you can offer the insurance product, from the drop-down list. Select ALL if this is offered for all the states. |
Currency |
Select the currency for which you can offer the insurance product, from the drop-down list. Select ALL if this is offered for all the states. |
A brief description of the fields is given below:
Field: |
Do this: |
Insurance Sub Type |
Select the insurance sub type you want to define for the entry in the Insurance section, from the drop-down list. For example SINGLE. |
Term From |
Specify the minimum term for the insurance sub type. |
Rate |
Specify the rate for premium calculation per $1,000.00 for the insurance sub type. |
Max Coverage Amt |
Specify the maximum coverage amount covered by the insurance sub type. |
Enabled |
Check this box to enable the insurance. |
A checklist is an optional set of steps to follow when completing a task in the system, such as the underwriting and funding processes.
Checklists can be used as guidelines to help ensure that the system users follow your business’s standard operating procedures and enter all required data. Some checklists are optional, but others such as those related to application decisions or contract verification, may be required depending on the edit sets defined in your system. The Checklists screen allows you to specify the contents of the checklist.
You can define additional checklists for your organization. You can set up multiple checklists for a single type of checklist. These checklists can be differentiated by:
To set up the Checklists
You can either define new Checklist Type Definition details or specify a new code in the New Checklist field and click Create Copy to create a copy of selected checklist type definition with details.
Field: |
Do this: |
Checklist Code |
Specify the checklist code that identifies checklist being defined. |
Description |
Specify the description for the checklist. |
Checklist Type |
Select the checklist type from the drop-down list, to define where the specific checklist will be available in the system. |
Company |
Select the portfolio company associated with the checklist from the drop-down list. This may be ALL or a specific company. |
Branch |
Select the portfolio branch associated with the checklist from the drop-down list. This may be ALL or a specific branch. This must be ALL if in the Company field you selected ALL). |
Channel |
Select the channel from the drop-down list, This can be ALL or a specific channel. |
Product |
Select the product associated with the checklist from the drop-down list. This may be ALL or a specific product. The available values come from a validated list based on the selected Billing Cycle setup and the Product setup. |
State |
Select the state associated with the checklist type from the drop-down list. This may be ALL or a specific state. IMPORTANT: By selecting which edits type to use, the system searches for a best match using the following attributes: 1 Company 2 Branch 3 Product 4 State Hence, Oracle Financial Services Software recommends creating one version of each checklist type where ALL is the value in these fields. |
Currency |
Select the currency associated with the checklist from the drop-down list. This may be ALL or a specific currency. |
Enabled |
Check this box to enable the checklist. |
Checklist actions are steps (a set of one or more tasks) related to the checklist you are creating. They are loaded on the Checklist Action Definition section.
A brief description of the fields is given below:
Field: |
Do this: |
Action Code |
Specify the action code for the checklist. |
Description |
Specify the description for the action type. |
Sort |
Specify the sort order to define the placement of the action type on the Checklist sub screen. |
Enabled |
Check this box to include this action in the checklist. |
A brief description of the fields is given below:
Field: |
Do this: |
Action Code |
Specify the action code for the checklist. |
Description |
Specify the description for the action type. |
Document Type |
Select the document type from the drop-down list. |
Document Sub Type |
Select the document sub type from the drop-down list. |
Document Mandatory |
Check this box to indicate that the document is mandatory. |
Sort |
Specify the sort order to define the placement of the action type on the Checklist sub screen. |
Enabled |
Check this box to include this action in the checklist. |
The system supports the automatic generation of default stipulations for loans during origination on the Underwriting window’s Stipulation sub screen (Decision link). The default stipulations can be maintained by company, branch, product, state, application status and application sub-status on the Stipulations screen.
To set up the Stipulations
A brief description of the fields is given below:
Field: |
Do this: |
Company |
Select the portfolio company associated with the default stipulations, from the drop-down list. |
Branch |
Select the portfolio branch associated with the default stipulations, from the drop-down list. |
Product |
Select the product associated with the default stipulations, from the drop-down list. |
State |
Select the state associated with the default stipulations, from the drop-down list. |
Currency |
Select the currency associated with the default stipulations, from the drop-down list. |
Application Status |
Select the application status associated with the default stipulations, from the drop-down list. |
Application Sub-Status |
Select the application sub status associated with the default stipulations, from the drop-down list. |
Enabled |
Check this box to allow the default stipulations to be used. |
A brief description of the fields is given below:
Field: |
Do this: |
Stipulations |
Select the stipulation from the drop-down list. |
Sort |
Specify the sort sequence for the stipulation. |
Enabled |
Check this box to allow the stipulations details to be used by the system. |
The Letters screen allows you to define letters that the system automatically generates when the application or the account for a products meets certain conditions, or “trigger events.” Each letter has its own trigger event. For example, you can configure the system to automatically send a welcome letter when an application becomes an account or send a collection letters when an account becomes delinquent.
The system supports the following types of letters:
Type of letter: |
Definition: |
ACCOUNT STATEMENT |
Generated when account is to receive a billing statement (this time is defined in contract setup). Letter is sent to customer. |
ADVERSE Action letter |
Generated in nightly batch jobs for applications that were declined. This letter is sent to the consumer to indicate the reasons why the application was declined. |
CONDITIONAL ADVERSE |
Generated in nightly batch jobs for applications that were |
ACTION LETTER |
declined. This letter is sent to the consumer to indicate the reasons why the application was declined. This letter also indicates steps that the consumer may take to gain approval of the application. |
COLLECTION LETTER 1 |
Generated when an account becomes delinquent. This is the first dunning letter sent to the customer. |
COLLECTION LETTER 2 |
Generated when an account remains in delinquency for an extended period. This is the second dunning letter sent to the customer. |
COLLECTION LETTER 3 |
Generated when an account remains in delinquency for an extended period, even after having received previous notices. This is the final dunning letter sent to the customer. |
CONTRACT FUNDING fax/email |
Generated when an application is APPROVED: FUNDED or conditioned: funded. This letter is sent to the producer. |
DECISION FAX/EMAIL |
Generated when an application is APPROVED, conditioned, or rejected. This letter is sent to the consumer or producer, depending on whether the product is a direct or in-direct loan. |
PAID IN FULL LETTER |
Generated in nightly batch jobs when the account pays off. This letter is sent to the customer. |
PAYOFF QUOTE LETTER |
Generated when a payoff quote is created for an account. This letter is sent to the customer. |
WELCOME LETTER |
Generated when an application is APPROVED: FUNDED. This letter is sent to the consumer. STATEMENT PAST MATURITY Generated when an accounts are matured but unpaid. This letter is sent to the account holders as a reminder to make their payments. |
When the system generates letters, it searches the Letters screen for letter definitions that meet the following criteria:
Exact matches for each field are given a higher weight than matches to ALL.
The returned rows are then given a descending rank based on the weighted values and the hierarchical position of these fields:
On the ranked rows, the first row is returned as the best match.
To set up the Letters
A brief description of the fields is given below:
Field: |
Do this: |
Letter Code |
Specify the code for the letter. |
File Name |
Specify the file name of the Oracle report used to generate the letter. The file should be named <File Name>.rep on your server. |
Letter Type |
Select the type of letter you want to generate from the drop-down list. |
Channel |
Select the application source (channel) for the letter from the drop-down list. This may be ALL or a specific channel. |
Enabled |
Check this box to enable this letter definition. |
Result section |
|
Batch Printer |
Select the batch printer being used to generate the letter from the drop-down list. |
Batch User |
Select the user who will submit this letter from the drop-down list. This will normally be set to BATCH. |
Selection Criteria section |
|
Company |
Select the portfolio company for which this letter will be used from the drop-down list. This may be ALL or a specific company. |
Branch |
Select the portfolio branch for which this letter will be used from the drop-down list. This may be ALL or a specific branch. This must be ALL if in the Company field you selected ALL). |
Product |
Select the product for which this letter will be used from the drop-down list. This may be ALL or a specific product. |
State |
Select the state for which this letter will be used from the drop-down list. This may be ALL or a specific state. |
Currency |
Select the currency for which this letter will be used from the drop-down list. This may be ALL or a specific currency. |
The Introductory tab of Promotions screen allows you to set up the promotions that a financial institution can offer its customers. Promotion details defined here can be selected during Application Entry and Application processing.
You can define multiple promotions for a product, then select the appropriate promotion at the time the application is processed. Promotions also serve as a selection criteria on the Pricing screen.
CAUTION: The system supports promotions selected only when a product is funded.
Note
Promotions will only be supported for ‘Interest Rate’ type of lease calculation method.
In the case of the same as cash promotion:
Interest & Payments
Interest still continues to accrue for a account that is funded using the SAME AS CASH promotion. However, the interest accrued during the promotion period is not charged or collected on the account until the end of the promotion period.
Any repayment made by the customer during the promotion period is applied towards the lease receivables amount. The system then calculates the interest accrual using the reduced lease receivables amount, if applicable.
If the product remains unpaid after the end of the promotion period and the lease receivables balance is above any stated tolerance amount, then the system starts collecting interest earned and accrued during the promotion period.
Oracle Financial Services Lending and Leasing’s promotion method PROMOTIONAL RATE allows you to create and specify promotions where customers can be charged lower interest rates during a specific promotional period of time. You may define the length of the promotion in either terms or days. Also, you will be able to set the specific interest rate you want to attach to the promotion. During the promotional period, interest on an account is accrued at the promotional rate. When the promotional period expires, the system changes the interest rate of the product to the contractual interest rate to accrue interest. The promotion expires on the promotion end date defined by the length of the promotion. However, the system allows you to set a grace period for extending the automatic cancellation of the promotion due to delinquency, similar to the grace period associated with a payment date.
To set up the Lease Introductory
A brief description of the fields is given below:
Field: |
Do this: |
Code |
Specify the code identifying the promotion. |
Description |
Specify a description of the promotion being offered. |
Type |
Select the promotion type from the drop-down list. |
Period Type |
Select the period type from the drop-down list. Note: Select PROMOTIONAL DAYS, if the length of the promotion is to be measured in days. Select PROMOTION TERM, if the length of the promotion is more accurately measured in terms. |
Period |
Specify the specific promotion period. If you have selected PROMOTIONAL DAYS in the Period Type field, then enter the number of days of the promotion period duration. If you selected PROMOTION TERM, then enter the number of terms for which the promotion applies. Remember that the system uses the same length of the term increment that is used in the billing cycle for the Lease; for example, weekly, monthly, semi-annual, or annual. |
Tolerance Amt |
Specify the dollar amount of the allowed “tolerance”, if applicable. This is the amount that can be outstanding at the end of the promotion period. Note: This applies only to the promotion type same as cash. |
Index |
Select the promotional index rate from the drop-down list. |
Margin |
Specify the promotional margin rate. |
Cancel Delq Days |
Specify the tolerance days for the promotion cancellation due to delinquency. |
Enabled |
Check this box to enable the promotion |
Lease Calc Method |
The lease calculation method is selected as ‘INTEREST RATE’ on save since lease promotion is applicable only for ‘Interest Rate’ type of calculation method. |
The Subvention Setup screen’s lease Subvention tab allows you to set up lease subvention plans for producers (groups or individuals). Multiple producers may contribute to one subvention plan or a plan can be set for a specific producer.
Subvention can be offered in many forms for vehicle leases. The most common format is the Rent factor for vehicle leases. Rent factor subvention involves sharing the finance charge (interest) by the participant (most frequently with the manufacturer). The finance company sets its buy rate (the minimum cost to the company to extend the Lease to a customer). If the customer rate is less than this buy rate, then the amount is equivalent to the interest amount for the difference (the buy rate minus the customer rate) is paid by the participant as the subvention amount.
Currently Oracle Financial Services Lending and Leasing supports the following subvention types:
Lease subvention types:
Subvention plans can be defined for one participant (for example, a manufacturer or a particular dealer) or group of participants (such as a dealer association). One subvention plan could have multiple sub plans and multiple participants could participate to each sub plan.
Example
Subvention plan:
Subvention sub-plans for above plan:
- or -
- or -
- or -
Multiple participants may participate in each sub plan. For example, for the 1.9% rate, 1% might be shared by the manufacturer and 0.9% might be shared by the dealer. Similarly, for the $1,500 cash bonus, $1,000 might be shared by the manufacturer and $500 by the dealer. Or, the complete $1,500 might be covered by the manufacturer.
Collection of subvention amounts can be set for each participant in the subvention plan with the Collection Method.
Oracle Financial Services Lending and Leasing supports following collection methods:
Type |
Details |
UPFRONT |
The entire subvention amount is collected at the booking of the Lease from the producer proceed. |
UPFRONT STATEMENT |
The entire subvention amount is collected at the time of the subvention statement. |
PAY AS U GO |
The subvention amount is billed to the producer when the customer pays the Lease payment. The producer is due for the amount at each statement. |
There are times when a Lease is either paid-off early or gets charged off and the finance company refunds the unearned subvention amount back to the producer. The refund is available only when the subvention amount is collected from the producer proceeds (upfront) or the whole amount is billed in the first statement (Upfront Statement).
You can set up the system to allow refunds only for a certain period and not beyond that. The period can be set differently for charge offs and paid offs and can be based on two methods:
The system provides the following methods for refund amount calculation:
The earned method is used to refund the unearned portion of the collected subvention amount. The percentage method is used to refund a certain percentage of the subvention amount collected.
The Lease Subvention Plans screen allows you to set up subventions for Leases.
To set up the Lease Subvention Plans screen.
A brief description of the fields is given below:
Field: |
Do this: |
Code |
Specify the subvention plan code. |
Description |
Specify the subvention plan description. |
Company |
Select the company name from the drop-down list. |
Branch |
Select the branch name from the drop-down list. |
State |
Select the state from the drop-down list. |
Start Date |
Specify the start date for the subvention plan (required). You can select the date even from the adjoining Calendar icon. |
End Date |
Specify the end date for the subvention plan. You can select the date even from the adjoining Calendar icon. |
Enabled |
Check this box to activate the record. |
Selection Criteria |
|
Billing Cycle |
Select billing cycle from the drop-down list. |
Product |
Select the product from the drop-down list. |
Asset Class |
Select the asset class from the drop-down list. |
Asset Type |
Select the asset type from the drop-down list. |
Asset Sub Type |
Select asset sub type from the drop-down list. |
Asset Make |
Select asset make from the drop-down list. |
Asset Model |
Select the asset model from the drop-down list. |
Asset Age |
Specify the asset age. |
A brief description of the fields is given below:
Field: |
Do this: |
Code |
Specify the subvention sub plan code. |
Description |
Specify the subvention sub plan description (required). |
State |
Select the state from the drop-down list. |
Pro Group |
Select the producer group from the drop-down list. |
Pro Type |
Select the producer type from the drop-down list. |
Producer |
Select the producer from the drop-down list. |
Enabled |
Check this box to activate the record. |
Amt From |
Specify the amount. |
Subvention Type |
Select the subvention type from the drop-down list. |
Grade |
Select the grade from the drop-down list. |
Term |
Specify the term. |
Asset Class |
Select the asset class from the drop-down list. |
Asset Type |
Select the asset type from the drop-down list. |
Sub Type |
Select asset sub type from the drop-down list |
Asset Make |
Select asset make from the drop-down list. |
Asset Model |
Select the asset model from the drop-down list |
Age |
Specify asset age. |
A brief description of the fields is given below:
Field: |
Do this: |
Participant |
Select the participant from the drop-down list. |
Collection Method |
Select the collection method for the subvention plan from the drop-down list. |
Transaction |
Select the transaction code from the drop-down list. |
Rate |
Specify the subvention rate. |
Enabled |
Check this box to activate the record. |
Calculation section: |
|
Method |
Select the subvention calculation method from the drop-down list. The list displays the following values: - SPREAD DEFAULT - SPREAD DEFAULT - (minus) PRESENT VALUE - FLAT AMOUNT - % OF CAPITALIZATION COST GROSS - % of CAPITALIZATION COST GROSS + FLAT AMOUNT |
Override |
Check this box to allow overriding the rate at the time of underwriting / funding. |
Max Amt |
Specify the maximum subvention amount. |
% Capitalized Cost |
Specify the percentage of capitalized cost to derive the Subvention Amount. For example: If Capitalized Cost = 100$, and % of Capitalized Cost = 5%, then the Subvention Amount = 100 * 0.05 = 5$ |
Flat Amt |
Specify the flat amount. |
Factor |
Specify the subvention factor. |
Spread Max |
Specify the maximum subvention spread value. |
Refund section: |
|
Paid Off Method |
Select the method from the drop-down list, if the account is paid-off early. |
Paid Off Basis |
Select the basis from the drop-down list, if the account is paid-off early. |
Paid Off Period |
Specify the number of terms in which the subvention can be refunded to the producer, if the account is paid-off early. |
Paid Off Percent |
Specify the refund percentage, if the account is paid-off. |
Charge Off Calc Method |
Select the calculation method from the drop-down list, if the account is charged-off. |
Charge Off Basis |
Select the charge off basis from the drop-down list. |
Charge Off Period |
Select the charge off period from the drop-down list. |
Charge Off Percent |
Select the charge off percent from the drop-down list. |
Amortization section: |
|
Balance Type |
Select the amortize balance type from the drop-down list. |
Method |
Select the amortize method from the drop-down list. |
Frequency |
Select the amortize frequency from the drop-down list. |
Cost / Fee |
Select the cost / fee from the drop-down list. |
Perform any of the Basic Actions mentioned in Navigation chapter.