In this session we are
looking at Interest Rate Groups. Interest Rate Groups are
used for specification on Loan Templates which are in turn used to open new
Loans where the Loans will automatically inherit the Interest Rate Groups as
specified on the Loan Templates, and of course the Interest Rate Groups can
also be directly specified or edited on the Loans Records. |
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We can of course have as
many Interest Rate Groups as we need in our Loans Portfolio Management. When Interest Rate
changes occur, then we only have to change it on the Interest Rate Groups and
the Loans will automatically, from its pointers to the Interest Rate Groups,
know which New Rates apply to which Loans. |
An Interest Rate Group
essentially has a Group Code and a Description. Then we can also have 1 or
multiple Rates listed for a Period or a Date. We can also have Rate
Changes by Date, within a Period, in which case we will repeat the Period and
specify the New Date for the Rate Change. Now the Period Rate
Indicators will apply when Interest must be calculated on Monthly Advance or
Monthly Arrears. When Interest is
calculated on Daily Balance, then the System will look at the Date to
determine the Interest Rate to apply. |
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For each Interest Rate
Group we can choose between Calculation on the basis of the 360-day year or
the 365-day year. These being two
different methods that are applied in different parts of the world. |
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Once
we have Interest Rate Groups, then of course we can use them on the Loan
Templates and the Loan Templates of course are used for the Opening of New
Loans. |
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On any Loan Master
Record we can see which Interest Rate Groups are used for the various
Interest Rate Indicators as inherited from the Loan template or as directly
specified or edited. |
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