AutoPal Software makes it easy to customize loan schedules and accommodate to different types of lending. One such method is through the utilization of the “Escrow Calculator”. This specific section allows you to add a per-period escrow to loans. These escrows can be used to cover optional loan products (i.e. insurance policies, etc.), or as a means of increasing the per-period payment as a fee.
To access the “Escrow Calculator”, access a loan that has not yet been activated, and select the “Initial Setup” icon. You will then be greeted with the following screen:
The “Escrow Calculator” section is composed of seven fields, these fields offer different methods of calculation, and data entry.
Please note: Before entering data into these fields, it is important to understand that depending on Advanced Configuration settings, these amounts may alter the output APR of the loan.
Taking a closer look at the fields in this section you will see the following fields:
- Total Escrow: The amount in this section is the total of escrow you are wishing to attach to a specific account. The amount will be divided by the term to arrive at a per-period amount. For example, if you enter $1000 into the “Total Escrow”, and the term of the loan is 10, the payment will increase by $100 per period.
- Escrow Percentage: This field allows you to enter a percentage rate that will use your selected “Escrow Percent Base” to calculate the “Total Escrow” on a loan account.
- Escrow Percent Base: Select the base that is used to calculate the “Total Escrow” if you elect to enter a percentage. The options include “Loan Amount”, and “Sales Price”. For example, if you were applying a 10% escrow, based on loan amount, and the total loan amount was $1200, the “Total Escrow” would auto-fill to $120.
- 1st Period Escrow: Enter the amount of escrow that should be assessed in the first payment period if the amount is different from what will be assessed in other payment periods.
- Pro-Rate 1st Period: Select whether or not the escrow amount for the first period is pro-rated. If “Yes”, the pro-ration will be determined by the ratio of the number of days in the first payment period to the number of days in a standard payment period.
- Regular Period Escrow: The amount of a standard periods escrow.
- Extend Final Period: Choose whether escrow that was not assessed as part of regular payments should cause the final payment to increase in amount, or extend the loan term.