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Loan Refinancing

This functionality allows the user to give additional funding to a client when he/she has an outstanding loan. This may or may not involve change of previous loan terms such as loan period, interest rate, interest calculation method, Installment numbers, installment type, collateral and guarantors as shown in Loan Entry Part 1 Loan Entry Part 3 Individuals and Loan Entry Part 4 Groups.

• Please note that the refinanced loan will go through the process of loan approval and with such approval being done by a different system user otherwise the system returns the following warning message.

How to Refinance a Loan in LPF

To refinance a loan you go to Loans>Loan Refinancing and a screen like the one below shows up

:

Loan number:Click on the Choose command button to pick the loan from the grid then click on Look to continue.

Click on the "Look" button and the following screen appears:

• Refinance Date: Enter here the date of the refinancing e.g "15/06/2015".
• Penalty Balance: The penalty balance if any will automatically populate here.
• Principal Balance:The principle balance will automatically populate here.
• Interest Balance: The interest balance up till the refinance date will populate here.
• Total Balance: The total balance which is the summation of principle, interest, penalty, and commission will automatically populate here.

• Please note that LPF capitalizes the outstanding loan balance, interest, Commission and Penalty.

• Added Finance: Enter the additional finance amount applied for here.
• New Loan Amount: The aggregate amount of the old loan balance and the additional finance will automatically be populate here.
• Disbursed amount:The total balance and the additional finance which actually is the amount ready for disbursement appears here.
• Refinance fee: Loan performer gives the option to charge or not to charge a refinance fee. Enter the refinance fee here if it is to be charged. The General ledger account for the refinance fees needs to have been defined at System Configuration/Loan Product Settings/GL Accounts 1-2 Settings :
• Click on the Next command button to continue to Loan Entry Part 1 , from where other adjustments to the loan parameters can be done up till Loan Entry Part 3 Individuals
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Please note that the original loan is automatically paid off at disbursement and LPF assigns a new loan number to the client.

The loan then goes through the normal process of paying any other fees if they are required before approval.

Related Topics

Contact LPF live support for more information
This service requires an Internet connection.