Below is a summary of all available Payment Type options in PrecisionLender. Available Payment Type options may vary by product, which are configured in the Administration Section.
- Amortizing – A payment type where the principal (commitment) is paid down over the life of the loan according to an amortization schedule, typically through equal payments. Over time, the amount of principal paid in each payment will increase, while interest payment will decrease. PrecisionLender allows you to add an interest only period to amortizing type loan.
- LOC (Line of Credit) – A payment type used primarily for an operating line of credit where the borrower has the ability draw out and repay parts or all of the commitment throughout the duration the loan. No payment schedules accompany this payment type.
- Letter of Credit - A Letter of Credit is a letter from a bank guaranteeing that a buyer's payment to a seller will be received on time and for the correct amount. In the event that the buyer is unable to make payment on the purchase, the bank will be required to cover the full or remaining amount of the purchase. In PrecisionLender, Letter of Credit is a payment type that can be available for any product in the product assumptions screen, although we suggest setting it up as its own product in order to be able to set the Usage Given Default accurately.
- Scheduled Draws – A payment type that can be used on any loan where the commitment of funds needs to drawn on a variable schedule.
- Scheduled Draws and Repays – A payment type that can be used on any loan where the commitment of funds need to be drawn (advanced) and repaid on a variable schedule.
- Scheduled Repays - A payment type where funds will disbursed to the borrower at closing and the borrower will repay the loan on a variable schedule. Scheduled Repays lets you determine the amount of principal being repaid, and the payment amount can change over the life of the loan.
- Single Pay / Interest Only – A payment type selected for one of the following scenarios:
- Single Pay: If you would like the borrower to pay the principal and interest in a single payment, select the ‘Single Pay/Interest Only’ payment type and the under ‘Interest Options’, select a Payment Frequency of ‘At Maturity’.
- Interest Only: If you would like the borrower to pay only interest on the principle at a set frequency through the term of the loan, select the ‘Single Pay/Interest Only’ payment type and the under ‘Interest Options’, select the appropriate ‘Payment Frequency’.
- Amortizing / Level Principal – Similar to Amortizing payment type only the amount of principal paid in each payment stays the same throughout the life of the loan.