Pay Arrangement - Main

This page allows you to set up a payment arrangement. When you create a payment arrangement, the system performs the following functions:

It creates a payment arrangement contract (PA contract). It sets the installment amount on this contract equal to the installment amount specified on this page.
It transfers delinquent debt from each delinquent contract(s) to the new PA contract.
As it transfers the debt to the PA contract, it creates synchronizing adjustments to reduce the PA contract's current balance by the amount transferred. Why? Because when delinquent debt is transferred to the PA contract, its current balance increases. Because current balance contains the amount the customer currently owes, this balance must be reduced because the customer is going to payoff the debt in installments (and therefore they don't currently owe anything on the PA contract).

You could do the above functions by adding a new contract (using the Contract page) and creating transfer adjustments (using the adjustment page). However, this is tedious. Rather, open Delinquency Management, Pay Arrangement to set up or add additional debt to a payment arrangement.

Description of Page

Contract Info and Contract ID are displayed on every page. These values only appear after the payment arrangement contract (PA contract) exists on the database. The ID is a system assigned random number that stays with the payment arrangement contract for life. The Contract Info is a concatenation of important details about the payment arrangement contract and its account.

The Current Balance that appears beneath Contract Info contains the PA Contract's current balance. When you initially set up a PA contract this balance will be zero. It is only non-zero if the customer has not paid a billed installment.

Payoff Balance beneath Contract Info contains the PA Contract's payoff balance. The payoff balance is the total amount to be paid off over the PA contract's life. It is only non-zero after delinquent funds have been transferred to the PA contract. This balance is only displayed when it differs from the Current Balance.

Fastpath: Refer to Current Amount versus Payoff Amount for more information.

Account contains the name of the main customer on the account. Account ID is the account associated with the PA contract.

The occurrences of Current and Payoff Balance below Account are the account's respective balances. These values are displayed to help you confirm exactly how much the customer currently owes versus how much they will have to payoff over time (remember, after you transfer funds to a payment arrangement, the amount transferred is reduced from the account's current balance).

The Candidate Contracts scroll contains one row for each of the account's contracts with aged debt. The system displays the respective age and amount of each contract's debt. All debt that is checked will be transferred to the PA contract when you click Create.

CAUTION: The system automatically indicates that all debt that isn't "new" (i.e., debt that the customer has seen on their bills) should be transferred to the payment arrangement. It does this by checking each parcel of aged debt.

Total is the sum of ALL current balances (not just the checked amounts) from all candidate contracts.

The next two fields are used to populate the arrangement amount (i.e., the amount the customer will be billed on each bill).

The Installments field exists to calculate the Arrange Amount (the next field) when a time period has been stipulated. Simply enter the number of installments and tab out. When you tab out of the field, the system sets the Arrange Amount equal to New Payoff Balance/ Installments.

Note: Arrange Amount may not add up. You will note that the Arrange Amount is rounded up so that if you multiply the number of installments by the calculated installment amount, the result will be greater than the PA contract's payoff amount. Don't worry - only the actual dollar amount of the PA contract's total debt will be billed by the system. The last installment will be slightly lower than the other installments.

Use the Arrange Amount field to define the payment arrangement's installment amount if a specific dollar amount has been stipulated. For example, if the customer agrees to pay off their delinquent debt by paying an additional $50 on each bill, you'd enter "50" in this field. Note - If you enter a dollar amount in this field and tab out, the system will calculate the number of installments and display the number in the Installments field.

New Payoff Balance contains the PA contract's payoff balance. This is the total amount of debt that will be paid off over the lifetime of the PA contract. This value equals the current payoff balance on the PA contract plus all selected debt from the Candidate Contracts scroll.

Define the Division and Contract Type of the payment arrangement contract.

Note: Payment arrangement contract types. There is a field on contract type called Special Role Flag. Only those contract types with a role of Payment Arrangement may be selected.

Clicking Create (or Change)causes the system to perform the following:

It adds / updates a payment arrangement contract (PA contract). It sets the installment amount on this contract equal to the installment amount specified on the page.
It transfers delinquent debt from the delinquent contract(s) to the PA contract. The adjustment type used to transfer these funds is defined on the PA contract's contract type.
It reduces the current balance on the PA contract by the amount of debt transferred to the PA contract. Why? Because when delinquent debt is transferred to the PA contract, its current balance increases. Because current balance contains the amount the customer currently owes, this balance must be reduced because the customer is going to pay off the debt in installments (and therefore they don't currently owe anything). The adjustment type used to transfer these funds is defined on the PA contract's contract type.

You can transfer to the History page to view the transfer adjustments that were created by the system when it transferred the selected debt to the PA contract.

Clicking Break causes the PA contract to become broken. Please refer to the note below for what transpires when a PA is broken.

Note: Break logic is in a plug-in. Please be aware that the logic that is executed when a payment arrangement is broken exists in a plug-in algorithm (plugged-in on the PA contract's contract type). The base package algorithm expires the PA contract and cancels all related frozen adjustments, returning the debt to the original contracts. Because this logic is in a plug-in, you can develop alternative logic and plug it in if the base package logic is not satisfactory.