Preparing a New Loan Category

These steps explain how to create a new loan category code and configure its servicing parameters.

    1. If necessary, use Tool #202 Chart of Accounts/Budget Groups Maint to create the G/L accounts you’ll need for the loan category, including the member asset G/L, income G/L for interest earned, and the accrued interest asset G/L.

    View step-by-step instructions for creating a G/L account.

    2. If any brand-new G/L accounts were created in step 1, use Tool #383 GL Account Control Configuration to set up a cross-reference between the GL and the type of loan category you’ll be creating.

    Always create the accrual G/L account first (use application type LN for closed-end loan products or OC for open-end loan products including online credit cards).

    Then create the member loan G/L using the same application type, entering the accrual G/L account in the Cross reference G/L #1 field.

    View step-by-steps instructions for using this configuration.

    3. Next you’ll need to use Tool #105 Account Suffix Configuration to create the range of suffixes that will be assigned to the new loan category.

    Start by entering a range of suffixes.

    Before completing any of the other fields, press Enter to resort the screen.

    Enter a description, application type (either LN for closed-end loan products or OC for open-end loan products including online credit cards).

    4. If necessary, use Tool #706 Purpose Code Configuration to create new purpose code(s) to be used with the new category.

    View online help for creating purpose codes.

    5. If necessary, use Tool #785 Security Code Configuration to create new security code(s) to be used with the new category.

    View online help for creating security codes.

    6. Launch Tool #458 Loan Category and complete all screens to create the loan category code and all of its servicing parameters.

    View online help for loan category configuration screens.

    7. Now use Tool #470 Loan Product Configuration to create loan products to be attached to that new category code.

    At least one loan product code must be created in order to being creating loans under the new category.

    TIP: Select an existing product and use the Copy feature to start with a similar product, making changes to assign the new loan category code and any other settings as needed.