Late And or Unpaid Salaries, Rent, Annuities

Margill Loan Manager (MLM) can also manage late or unpaid salaries, rent or other annuities (such as support payments or alimony). Salaries, rent, support payments will all be referred to as "annuities" below.

Annuities are similar to loans but instead of the principal diminishing over time, it accrues over time. A loan starts at a certain loan amount and usually finishes at 0.00 over the amortization period. Unpaid annuities usually start at 0.00 and grow over time.

Create a new Record with "File" and "New Record". See also Creating the first record and Data entry screen Basics.

Let's do an example with a late and unpaid rent:

The tenant did not pay his June rent
The August and September rents were also not paid
The November rent was only paid on November 18
Rent is 1500 per month

How much is owed on January 1 if the late rent interest rate is 10% annually with simple interest (could also be monthly compounding if allowed by law). The rates can also be variable legal interest rates depending on the jurisdictions.

First change, in the "Advanced" window, the "Method" to "Simple Interest".

Year base (to take into account the small effect of leap year) may be left at "Anniversary" or changed to "Civil year" depending if a calculation norm exists. See the distinction in the Simple interest section.

The preliminary Data window would look like this:

The principal was left at 0.00 but could have been 1500 for the June 1 unpaid rent (but be careful not to count this rent twice). Instead, in order for all rents due to be neatly detailed in the Results Table, minus 1500 was entered as the payment (this will create a table as if ALL rents were not paid for these 9 periods).

The Amortization period was 9 payments to create a table that includes the interest up to and including January 1. Instead of manually counting the number of payments, in the "Amortization (Payments)" box, ( ) right click with mouse, chose "Specific Date" and in the window that opens, enter January 2, 2007.

Press on "Compute". The following window will appear. Click on "No" (our initial principal is 0.00 and should not be computed).

The preliminary Results Table below must now be edited to reflect our true situation. These would have been the results had each of these monthly payments not been made. Since the computation is performed with simple interest, the balance column in the Results Table window is the mathematical balance as opposed to the true balance reported at the very bottom of the window and in the printed report (see Balance column in schedule for further information on this topic).

Let us now edit the Results Table to reflect the various events. The line statuses may also be changed to more accurately reflect our situation.

In the screen below, the first three lines in blue below represent unpaid rent (June, August, September). The July payment is at 0.00 since the rent was paid and so was the October rent.

The 4th and 5th lines in blue represent respectively the unpaid November 1 rent (-1500) which was then paid (+1500) on November 18. The -1500 and +1500 payment cancel leaving only the interest portion to be accounted for during the 18 days.

Finally, no amounts were due for December and January thus the 0.00 payments. We then changed the final date to January 2 instead of February 1 (Pmt Date column) to get total interest up to January 1 inclusively.

The very same methods can be applied to late or unpaid salaries and alimony (support payments). For unpaid salaries, if salaries are paid every two (2) weeks, then the "Period of payments" should be "By day(s)" and "Number of day(s) 14: