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https://issues.apache.org/jira/browse/FINERACT-2311?page=com.atlassian.jira.plugin.system.issuetabpanels:all-tabpanel
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Adam Saghy updated FINERACT-2311:
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Fix Version/s: 1.12.0
> Buy-Down fees
> -------------
>
> Key: FINERACT-2311
> URL: https://issues.apache.org/jira/browse/FINERACT-2311
> Project: Apache Fineract
> Issue Type: New Feature
> Affects Versions: 1.12.0
> Reporter: Bharath Gowda
> Priority: Major
> Fix For: 1.12.0, 1.13.0
>
>
> h3. Background and Details
> There is a need to support an amortization schedule for 0% interest “buy
> down” loans where a merchant fee is collected and amortized into interest
> income over the life the loan. This amortized fee is NOT visible to the
> customer. This fee balance is posted to a deferred income account on the loan
> and would follow the daily amortization schedule as defined by the system.
> h3. Requirement Details
> # Buy-down fees will be added at the time of Disbursement through API
> # Buy-down fees can be added from the UI as well
> # Buy-down fees, is a unique transaction type that will be used to post the
> buy down fee to the loan account
> # Buy-down fees amount will not have any impact on the Schedule calculation
> or Interest calculation
> # Buy-down fees amount can either be a Interest or Fees Income
> # Buy-down fees will have daily amortization (similar to Capitalized Income)
> to amortize the deferred income.
> ## Equal amortization
> ## Formula based amortization
> ## Will need to accelerate the remaining balance of the deferred income on
> an early payoff.
> ## Will need to charge off any balance in deferred income when a loan
> balance is charged off.
> ## System should maintain a current deferred fee balance at the loan level
> # There is no impact or visibility to the customer for the amortization of
> the fee or daily recognition of the income.
> # Buy-down fee adjustment transaction type
> ## Can be added to loan account through API/UI
> ## it adjusts/credits the deferred Income.
> ## Adjustment transaction will not have any Impact on loan balance
>
> Accounting Entries and UCs are below
> [https://docs.google.com/spreadsheets/d/1qjJj-Yl6UOiiEMNnKufltDT8aNdYjxLB6DtSRsue910/edit?usp=sharing]
>
> ----
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