1. Cash Flow Engine Reference Guide
  2. Cash Flow Dictionary
  3. Cash Flow Columns
  4. Payment Increase Limit - Life (PMT_INCR_LIFE)
  5. Module Usage

8.2.114.2 Module Usage

Oracle ALM and Funds Transfer Pricing Cash Flow Methodologies reference PMT_INCR_LIFE when re-calculating the current payment for negative amortization events such as NEG_AMRT_LIMIT, PMT_ADJUST_DATE, and PMT_CHG_FREQ. This is relevant only for adjustable-rate accounts where AMRT_ TYPE_CD = 600.

  • For negative amortization-type accounts, the Cash Flow Engine uses PMT_ INCR_LIFE to calculate the maximum increase in the payment allowed during the life of the account.
  • PMT_INCR_LIFE is defined in terms of a percentage of ORG_PAYMENT. The Cash Flow Engine performs the following check:

    Newly Calculated Payment - ORG_PAYMENT > (PMT_INCR_LIFE/100 * ORG_PAYMENT)

    If the newly calculated payment satisfies the earlier equation, the Cash Flow Engine limits the increase to the amount = (PMT_INCR_LIFE * ORG_ PAYMENT).

    For example, if PMT_INCR_LIFE = 25.00, the calculated current payment is not allowed to increase by more than 25% of ORG_PAYMENT.

    Note:

    The PMT_INCR_LIFE is referenced when the following negative amortization events occur:

    NEG_AMRT_LIMIT

    PMT_ADJUST_DATE

    PMT_CHG_FREQ

  • For an explanation of PMT_INCR_LIFE's relationship with other related negative amortization fields, see the Negative Amortization Amount (NEG_AMRT_AMT).