How To Start A Loan Service Agreement

Loan service agreements are created using start/stop just like all other service agreements. The start/stop transaction has special loan functionality that allows an operator to specify the service agreement-specific loan terms described above.

Creating a loan service agreement involves the following steps:

  • Select the account on Control Central then open Start/Stop.
  • Enter a Start Date and a Start Method of Start a SA.
  • Indicate the CIS Division / SA Type of the loan service agreement and click the Start button.
    Note: If the service agreement’s account’s CIS Division’s Restrict to Account CIS Division flag sis set to Restricted, the CIS Division is set to the account’s CIS Division and cannot be changed.
  • After you click Start, the Start Confirmation page appears. When you select a loan service agreement type, the Start Confirmation page displays special fields that allow you to specify the loan's terms.
  • Select a loan Start Option. The start option includes the adjustment type for booking the principal amount, and can also include defaults for the initial loan amount, periodic payment amount, payment periods, and interest rate. The system uses the information on the start option to populate the service agreement's default parameters. You can manually override these parameters:
    • Enter the Loan Amount (the amount that the customer is borrowing). Note that the label for the Total Amount To Bill (e.g., Loan Amount) may appear differently depending on how the SA type was defined.
    • The system can automatically calculate either the payment amount (based on the loan amount and the payment periods) or the payment periods (based on the loan amount and the payment amount). Enter either the Payment Amount or the Payment Periods and click Calculate. Note that the label for the Recurring Charge (e.g., Payment Amount) may appear differently depending on how the SA type was defined.
    • Once the loan parameters are populated, click Start.

The loan is created in the pending start state. The next time the SA activation process runs, it will activate the loan SA. If you want to activate the loan immediately, navigate to the service agreement page and click Activate SA.

Note:

Overriding the Interest Rate. The Interest Rate is a display only field. The interest rate is taken from the value of the interest bill factor defined on the SA type or the contract value of the interest bill factor on the start option if one is defined. After starting a loan, you can manually override the interest rate using Loan - Main if the SA type allows it.

Changing The Loan Amount. You can use loan maintenance to change the loan amount for an SA as long as the SA has not yet been activated. It may be helpful to transfer to Loan - Main , and verify the amortization schedule before activating the SA.