Penalty Interest Charging
Penalty interest is applied when a mortgagor fails to meet the agree payment terms of the mortgage. This can be for late payment of standard interest charge or late repayment of capital.
The Penalty Interest charge is applied to a standard interest charge and can be added at any time. Penalty Interest Notices can be generated and sent to the mortgagor. Once applied, penalty charges can be removed or paid using the same distribution and payment process as with standard charges,
To charge Penalty Interest for multiple mortgages, open the Mortgage Manager / Charging / Charge History tab. The tab will display all unpaid mortgage charges. Select the mortgage charges which are to have a penalty applied, then use the right click context menu and select the ‘Apply Penalty’ option.
To charge Penalty Interest for an individual mortgage, open Mortgage Manager / List / Mortgagor tab for the relevant mortgage and switch to the Mortgage Charge History tab. Select the mortgage charges which are to have a penalty applied, then use the right click context menu and select Apply Penalty.
Repayment of Capital
The capital of a mortgage can be repaid partially or in full at any time. The mortgage should be charged up to the repayment date and the value of the capital repayment added. The capital repayment can be applied to all or individually selected mortgagees.
To add a Capital Repayment value, open the Mortgage Manager / List / Mortgagor tab, then use the right click context menu and select Principal Charge.
Add the total amount of capital being repaid by the mortgagor followed by the amount being repaid to the individual mortgagees.
When complete click the Charge button.
Once capital has been charged, use the same distribution and payment process as with standard interest charges,
Once the Capital payment has been distributed and repaid to the mortgagees, the mortgage will recalculate to the reduced amount now owing.
Change of Mortgagee
Mortgagee contributors can be partially or fully withdrawn and replaced with different contributors at any time.
It is important to synchronise the existing contributor date out and sum invested with the new Contributor date in and sum invested. The mortgage system relies on having an equal value of mortgagor and mortgagee totals and an uninterrupted date range covering these values.
To withdraw a Mortgagee contributor investment, open the Mortgage Manager / List / Mortgagor tab and then switch to the Contributor List tab.
A list of current contributors will display. Select the contributor to withdraw and click the Edit button.
Set the amount Invested to the new value and the Date Out to change date. Click the Ok button.
To add a new Mortgagee contributor investment, open the Mortgage Manager / List / Mortgagor tab and then switch to the Contributor List tab.
A list of current contributors will display. Click the New button
Complete the form fields as you would have for a new mortgagee contributor.
| Field | Description |
| Sum Advanced | record the amount being invested in this mortgage by the Mortgagee |
| Invested | record the amount advanced to the mortgagor |
| Date In | record the date the investment is being made and when interest commences being charged |
| Date Out | record the date the investment was withdrawn |
| Interest Rate Low | record the rate of interest charged for interest paid to the mortgagee |
| Interest Rate High | record the rate of interest charged for penalty interest paid to the mortgagee |
| Commission Type | record the % rate calculating commission charged to the contributor. This can be calculated on the principle or interest, be a fixed amount or be none |
| Authority Held | record you have authority from the investor to make this investment |
| Authority Expiry | record the expiry date of the authority |
Click the Ok button to add the contributor.
To distribute the change of capital value between contributors, post a journal transaction between these mortgagee matters Journal Requests – LegalOffice User Guides