Several of my loans are “balloon notes,” with payments based on a 10 year amortization schedule and a “balloon” payment due in 3 years. How do I set up the “billing” instructions for this?
Let’s use the included “sample file” loan to Dan & Sally Homemaker (#7654321) as an example: This is a $19,500 2nd mortgage home improvement loan @ 11.25% funded 5/6/95 with a 10 year payback (payments due the 15th of each month). To convert this to a balloon note the master Account record would be set up exactly the same as it is for a “conventional” loan. But on the Billing Info tab we would enter the monthly ‘periodic payment’ of $271.38 (based on the 10 yr. amortization), “check” the “Billed Amt includes interest” option, AND enter a Maturity Date of “5/6/98.” When the customer’s May 1998 bill is printed the “Current Principal Due” will be the entire principal balance remaining … this is the “balloon” payment.
