Preparing a New Loan Category

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

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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 create 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.