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Hi Shiva,
I followed your instructions.
Unfortunately neither underpayment, nor advance payment do not work as on your screen shots.
Everything was set as you said. See attached file mifos-5731.zip
Underpayment repro:
Loan disburse 02.08.12
3 Installments due
One payment of 1000.
Result on screen shot - undepayment.jpg
Advance Payment repro:
Loan disburse 02.08.12
Apply payment of 2000, than again of 2000.
Result on screen shot - advance_payment.jpg
As I wrote previously, there is a problem with repaying a loan - I can repay loan with Declining Balance Equal Principal Installment without paying all interests.
Also I want once again draw your attention to OverdueInterestPaidFirst feature. What about officers who want to use other types of loans without Overdue Interest paid first option on?
Thanks,
Kasia