How to obtain the daily interest amount (per diem) in Margill Loan Manager

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Q: How to obtain the daily interest amount (per diem) in Margill Loan Manager?

A: This can be added very easily through a simple Mathematical Equation. 

Go to Reports > Equation Management and click on  

  1. Name the Equation
  2. Select the two required fields (balance and interest rate) from the various themes on the left
  3. Add the operators with the  button
  4. Divide by 365 days with the  button
  5. Save

You can now use this simple interest Equation in various reports picking it up in the Equations theme:

Record List Customized:

Document Merge (DOCX., RTF, PDF) for your Invoices and Statements:

Interest-only: Regular monthly interest vs. Exact day interest

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Question:

My company does interest-only 12 month bridge loans calculated in two ways.

  1. Payments are based on the number of days in a month with a balloon payment at the end (so payments change depending on the month)
  2. Each of the 12 payments is equal with a balloon payment at the end.

Can these two calculation methods be done in Margill?

Answer:

Yes.

In Simple interest, Margill will usually use the exact number of days in a month and in a year to compute the interest. The Day count would be Actual/Actual (or Actual/365 or Actual/360).

If the interest is to be the same every month, the use the 30/360 Day count which simulates months that are of the same length.

For Compound interest (what is called the Effective rate method – the banking method), there is an extra  calculation method option that calculates using the exact number of days and another that splits payment in equal periods. The Day count does not have to be used to “artificially” simulate the equal periods.

Texas Mortgage Finance

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We are proud to have another new user for the Margill Loan Manager Software. Texas Mortgage Finance just joined the Margill family. You can visit their website here.

The Margill Team

Margill Law/Standard Edition – Regular and Irregular payment schedule

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Question:

I was wondering who I could contact at Margill for help on calculating a rather complex amortization table.

Beginning on 6/25/17 – the principal loan amount was $640,000 at an interest rate of 3% – payments of $3,000 to begin on 1/1/2018.

  • However, a payment of $350,000 was made on 7/12/2017
  • Additional loan amount of $500,000 was made on 9/25/2017
  • Additional loan amount of $150,000 was made on 12/8/2017

Answer:

Actually quite simple:

Go to “Recurring Payments” calculation. We will suppose this is compound interest, compounded monthly and monthly payments since it is a loan.

Let’s suppose 20 payments of $3000 each (if payments are missing or if there are too many, you can add or delete after).

Enter the data below:

Then Compute or F5.

This is our preliminary schedule:

 

You can now edit the schedule by adding the lump sum payment and extra principal.

The payment and extra principal were made in 2017 so I should add three lines above my payment date of 2018-01-01

I can do this with this icon or the right mouse click:

Then change the dates – start with Line 3 since you must follow the chronological order:

And finally change the amounts (1 payment and 2 loans). Notice lines 2 and 3 are negative since we are adding principal.

Now of course, with a balance of 934,064.93 after 20 payments, we would need to add a bunch of payments to fully pay back. You could add these lines with this icon (we would need to add hundreds of payment since payments are quite low):

My guess is you are looking for a balance at a specific date (let’s say today, start of day). Insert a line with a 0.00 payment:

And there you have it.

New Margill Loan Manager client: Nevada Western Interstate Commission for Higher Education

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We would like to welcome the Nevada Western Interstate Commission for Higher Education (WICHE) as a new user of our Margill Loan Manager software.

The Western Interstate Commission for Higher Education is a regional organization created by the Western Regional Education Compact and adopted in the 1950s by Western states. WICH was created to facilitate resource sharing among the higher education systems of the West.

You can visit their website here.

The Margill Team

Margill at the LendIt Fintech

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The Margill team will exhibit at the LendIt Fintech USA 2018 Conference at the Moscone West in San Francisco, California.  Come visit us at booth number 1649 from April 9 to the 11th, 2018.

Bank of Canada rate

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The Bank of Canada raises its base rate by 0.25% effective January 18, 2018.

Can Margill Loan Manager be used to manage rentals (rent)?

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Question: Our company does loans and rentals. Can Margill Loan Manager be used to manage rentals (monthly rents)?

Answer: As strange as this may sound for a loan servicing software, yes Margill Loan Manager can manage rentals.

The difference between a loan and a rental is that loans begin with a principal amount borrowed that usually will decrease as payments are made for the interest and principal portions. Rent on the other hand, is due (accrued), and payable every month. So rent accrues usually on the first of the month and then is paid, hopefully, on the same day. Usually, interest is not charged on rent.

First, in Tools > Settings > Custom Column Titles, change the Column “Fees” title to “Rent”.

Create a new Record. Under Data enter the date at which the first rent is due. The same date should be entered in both Origination Date and First Payment Date. The rents are payable monthly. Principal (Original) should be 0.00 and since there is no interest on the rent, Annual Nominal Rate (%) should also be 0.00%. This is a three year rental for 575 per month. Press on “Add Fees” and a window will allow you to enter the monthly rent amount.

Then press on Compute and answer No to this pop-up. We do not want Margill to compute the Principal (remains 0.00).

The rental payment schedule then appears. I moved my column called “Rent – Accrued” to the left to see it readily without needing to scroll to the right. The rent is “charged” with the “Rent – Accrued” and paid with the “Payment” column.

Notice on line 3 that my rent is a few days late. This does not change anything mathematically since interest is not charged, but this allows you to balance with your banking transactions. A partial rent amount could also have been entered and the schedule then changed based on what was agreed for later repayment between the “landlord” (or equipment rental) and the person who rents.

To be fancy, I renamed a Paid Pmt (x) Line status to “Paid Rent”. Go to Tools > Settings > Line status.

A little banking humor! His name was Boudreaux…

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His name was Boudreaux. He was from Cutoff, Louisiana … and he needed a loan, So…….. 

He walked into a bank in New York City and asked for the loan officer. 

He told the loan officer that he was going to Paris for an International Cajun festival for two weeks and needed to borrow $5,000, and that he was not a depositor  of the bank. 

The bank officer told him that the bank would need some form of security for the loan, so Boudreaux handed over the keys to a new Ferrari. The car was parked on the street in front of the bank. 

Boudreaux produced the title and everything checked out. The loan officer agreed to hold the car as collateral for the loan and apologized for having to charge 12% interest. 

Later, the bank’s president and its officers all enjoyed a good laugh at the Cajun from Louisiana for using a $250,000 Ferrari as collateral for a $5,000 loan. An employee of the bank then drove the Ferrari into the bank’s private underground garage and parked  it. 

Two weeks later, Boudreaux returned, repaid the $5,000 and the interest of $23.01. The loan officer said, “Sir, we are very happy to have had your business, and this transaction has worked out very nicely, but we are a little puzzled.” 

 “While you were away, we checked you out on Dunn & Bradstreet and found that you are a distinguished alumni from LSU, a highly sophisticated investor and multi-millionaire with real estate and financial interests all over the world. Your investments include a large number of oil rigs around south Louisiana. What puzzles us is, why would you bother to borrow $5,000?” 

The good ‘ole boy replied, “Where else in New York City can I park my car for two weeks for less than $25.00 and expect it to be there when I return?” 

His name was Boudreaux…. Keep an eye on those Louisiana boys! 

Just!! cuz we talk funny doesn’t mean we’re stupid !