3.2.19 Discount Multiple Schedules for Discounted Loans

While purchasing a portfolio of discounted loans you need to discount multiple schedules. Oracle Lending allows you to combine multiple principal schedules, each having an independent amount and repayment date, in one contract.

All the principal amounts are discounted from repayment date to payment date by using the same discounting rate. The combined amount is then liquidated in parts during each repayment schedule.

Note:

The interest at the end of each schedule is calculated on the installment schedule amount rather than the total outstanding principal in that schedule.

Example

A customer of portfolio purchase has a discounted loan with the following attributes:

• Loan Amount - USD 9,000
• Interest Rate - 10% p.a.
• Discounted Amount - USD 8,854.83
• Repayment schedule-3 installments of USD 3000 each
• Origin Date - January 01, 2002
• Repayment Dates - 1^st of each month

For portfolio purchase, the chronogram is:

Due Date	Days	Principal Liquidated	Interest Liquidated	Total
01-Feb-2002	31	USD 2,974.74	USD 25.26	USD 3,000
01-Mar-2002	59	USD 2,952.28	USD 47.72	USD 3,000
01-Apr-2002	90	USD 2,927.81	USD 72.19	USD 3,000
TOTALS		USD 8,854.83	USD 145.17	USD 9,000.00

To enable the process of discounting multiple schedules while purchasing a portfolio of discounted loans you need to enable the Interest On Schedule Amount option in the Additional Preferences screen.