5.2.27.1 Amortization for Escrow Components

If the Escrow component is part of amortization constant amount, then while redefining the following validations are performed.

• Schedule total amount(sum amount of PRINCIPAL, Main Interest Component and other additional amount constant interest components on a schedule due date) cannot exceed the instalment amount after escrow interest amount change.
• If EMI amount is exceeded for any of the schedules as part of the change in interest amount, VAMI fails. In this case, you have to adjust other parameters (interest rate, instalment amount, interest amount, no. of schedules) involved in the EMI constant, to keep the schedule amount equal to the EMI amount without violating any other validations.
• The above validations are not done for escrow components, if they are not selected as Amortization constant component.

Note:

Escrow component can be amended only through schedules details tab and not through CAMD or VAMI. You cannot amend escrow interest amounts through contract amendment for Amortization schedule type contracts, if Escrow components are part of the amortization constant.