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INTREST.LZH
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MANUAL.DOC
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1988-12-18
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18KB
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468 lines
Revolving Line of Credit
Interest Check
Copyright 1987
Bottom Line Software
P.O. Box 1804
Burleson, Texas 76028-1804
Table of contents
What does this program do? . . . . . . . . . . . . . . . . . 3
How does this program work? . . . . . . . . . . . . . . . . 3
Installation and running the program . . . . . . . . . . . . 3
The menu screen . . . . . . . . . . . . . . . . . . . . . . 3
Data Entry . . . . . . . . . . . . . . . . . . . . . . . . . 3
Transaction entry. . . . . . . . . . . . . . . . . . . . . 4
Editing transactions, (Correcting errors) . . . . . . . . . 7
Variable rate loans, changing the rate. . . . . . . . . . . 7
Regularly scheduled payments . . . . . . . . . . . . . . . . 8
The auto payment function . . . . . . . . . . . . . . . 8
Ending data input. . . . . . . . . . . . . . . . . . . . . . 8
Printing the schedule . . . . . . . . . . . . . . . . . . . 9
What does this program do?
Did the bank charge you too much interest? Did they use a
wrong date or rate? This is a simple program to check interest
calculations. It is not intended to print amortization schedules
with many repetitive transactions. It is used to check other
calculations or to print short regular or irregular payment
schedules.
How does this program work?
Most transactions are expected to be on irregular dates and
all amounts are entered manually. It can be used to print either
regular schedules of any length but due the flexibility in the
data entry method, it will not be as handy for such use as our
regular amortization program.
Installation and running the program
To start the program, copy it to your working disk and run
the program by typing its name, INTCHECK<RETURN>.
The first screen is the banner, the screen identifying the
program. press return to continue.
The menu screen
The main menu has only three options. First select option 6
to set the interest accrual basis. Some banks use a 360 day year.
Others use a 365 day year. Many banks use both. The 360 day year
produces higher interest accruals but in some cases, its use is
prohibited by laws or regulations. Most banks use 360 when they
can get away with it and 365 when they must.
First choose 360. If your calculations result in about 1.4%
more interest than the bank is charging, change to the 365 day
method and start over.
Data Entry
Now select option 1 to enter a schedule.
You will be asked the name of the lender. This is optional.
It will be printed on the printed report if you enter it.
You will next be asked for the name of the borrower. This
is optional. It will be printed on the printed report if you
Line of Credit, Interest Check page 3
enter it.
Next you will be asked for the initial accrual rate. This is
the rate the bank will use to compute the interest at the
beginning of the loan. It can be changed later if the loan is a
variable rate loan. This is not the APR. If you were given a
Regulation Z disclosure statement, it will state an ANNUAL
PERCENTAGE RATE. This is not the accrual rate. The accrual rate
will be stated in the note document using language something like
this. "with interest at the rate of _______ percent per annum."
If the loan is a precomputed consumer loan using the rule of
78ths to compute the interest accrual. This program will not
work. for these loans you need our regular amortization program,
PCLOAN4.
For our first trial enter 12 percent.
Next you will be asked the number of regular payments per
year. This may be 1,2,3,4,6,12,13,24,26, or 52. Any other number
will cause unpredictable results. If there are no regularly
scheduled payments, enter 1.
For our first schedule enter 12.
Next enter the amount of the regular payment, If there are
no scheduled regular payments, you may simply press return. For
now, enter 325.00.
The final request is for the type of payment. If the payment
amount includes interest, enter 1. For example the payment amount
is 325.00. The interest due is deducted from the $325.00 and what
ever is left is applied to principal. Enter 1. On the other hand,
the payment is 500.00 principal plus whatever interest has
accrued since the last payment. do not enter 1. Simply press
return.
You are now ready to enter transactions, first stem through
the sample transactions listed below to get a feel about how the
program works.
Transaction entry.
Note first that the screen is divided into three areas.
The top area is used to display the transactions in the form
of an abbreviated amortization schedule as you enter them. The
center of the screen is used for data entry and the bottom is
used for a message area to give you information about what to do
next.
When the data entry screen is first displayed, the
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transaction number will be 1, the interest rate will be the
initial rate you entered on the opening screen and the message
area will display a message asking you to enter the transaction
date.
Enter the date. Enter all six digits but no "-"'s or "/"'s.
The back space does not work. If you make a mistake, start over,
the numbers you enter will appear at the right side of the date
and push the old numbers out the left side. When you have the
date you want, press <return>.
Now try it. DO NOT PRESS <RETURN> UNTIL I TELL YOU. Press
these number keys 010188. The display shows 01-01-88.
Now press 03. The display shows 01-88-03.
Now press 3188.
The display shows 03-31-88. You have edited the original
date from 01-01-88 to 03-31-88.
Now press 86. The display shows 31-88-86.
Press <return>. A message flashes in the message area that
tells you that is not a valid date, the date clears and the
**-**-** pattern returns. You are now expected to enter a valid
date.
Enter the date 010188. Press <return>
You are now asked to enter the total payment. Do not enter
any amount, press <return>
Since the balance is zero, the interest accrued is zero and
you are asked to enter the interest payment. Do not enter any
amount. Press <return>.
You are now asked to enter the principal payment. Do not
enter any amount. Press <return>.
Now, since this is the first transaction, we must enter a
principal amount. This amount is referred to as the draw amount.
Usually this is the face amount of the loan but it may be any
accrual amount actually advanced by the lender to originate the
loan. It must be the amount on which the lender is charging
interest.
Enter a draw amount of 10000.00. Do not enter the commas.
When the cents are .00 you may omit them.
Refer to the left side of the data entry area. The beginning
balance is zero. This is the balance at the end of the previous
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transaction. Since there was no previous transaction, the
beginning balance is zero.
The Ending balance is the balance after the transaction we
just entered. It will also be the beginning balance for the next
transaction.
The interest rate is still 12%, the amount you entered to
begin the session.
The message area is offering you the opportunity to enter a
short comment. This is optional. If you enter a comment, it will
not disappear from the screen after you end this transaction. it
will appear on the printed report.
Press <return>
You now have a menu that allows you to either accept the
transaction as entered, or to edit, change, it. We will learn to
edit later, press <return> to accept this transaction and edit
the next.
The transaction appeared at the top of the screen, and a
message appears in the message area asking you the number of
regular payments to post. We will do that later, press <return>.
The data input area clears and asks for transaction 2. Enter
the date 021588.
The Number of days since the prior payment is calculated and
displayed, 45. The interest accrued is also displayed. The
interest is calculated for the actual number of days using either
a 360 or 365 day divisor. You must set this divisor to agree with
the number used by your bank. Almost all banks use 360.
You are now asked for the total payment amount. Assume you
can pay 325.00 and apply it to the interest with the remainder
going to the principal payment. Enter 325<return>.
You are now asked to enter the interest payment if it is
different from the amount shown. You can pay more or less than
the amount accrued. Normally you will pay just the accrued
amount. Press <return>.
You are now informed that we are paying 150.00 interest and
175.00 principal.
You are given the opportunity to enter another draw amount.
This sill usually be zero but in many commercial loans this
opportunity might be used. Press <return>.
You are now told the ending balance is 9,825.99, and offered
Line of Credit, Interest Check page 6
another opportunity to comment. Press<return>.
Again you are offered the opportunity to edit, change, this
transaction to correct errors. Press <return> to go on to the
next transaction.
Ignore the number of regular payments by pressing <return>.
The program is now ready to accept transaction 3. Enter the
date 030188. The number of days is 15 and the accrued interest is
49.13. You are asked to enter the total payment amount. Ignore
this request by pressing <return>.
You are now asked to enter the interest payment. Ignore this
request by pressing<return>. You have just instructed the
computer to use the accrued interest amount for the interest
payment.
Now enter the principal payment. Enter 825.00.
Again ignore the draw amount request by pressing <return>.
Ditto for the comment request.
Editing transactions, (Correcting errors)
OOOOps. We made a mistake. Note that the number 2 to the
left of the transaction date is highlighted. Press the down arrow
key one time. The highlight dropped to the 3. Do it again, 4. Do
it again, 5. Do it again, 6. Again, 7. Now the 7 is highlighted,
we made a mistake in entering the principal payment. Press the
function key F5. You are now asked to enter the amount of
principal payment again. This time enter 1000<return>. Note that
the entire screen has been recalculated.
Now press the up arrow key until the 2 is highlighted. Press
F5. Change the date to 032088. Note that the accrual days and the
accrued interest is recalculated. You may now either leave the
interest payment as is, or change it to the new amount. To change
it, move the highlight to the 6. Press F5. Press <return>.
The screen is now updated to show the new interest payment
and the new total payment.
Press <return> to accept the transaction.Ditto to skip regular
payments.
Variable rate loans, changing the rate.
Oh yes, the bank notified us that on March 21, the rate is
changing to 10.25%. Transaction 4 will be an interest change.
First enter the date. Total payment is 0. Interest accrued is
2.94 but interest paid is 0. Enter 0 for the interest payment
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(with the number key. Do not just press return). Again enter 0
for the principal payment and draw amount. This time we will
enter a comment. When asked for the comment enter "New interest
rate." Do not type the "" marks.
After entering the comment you are at the accept or edit
menu press the down arrow key until the 11 is highlighted the
press F5.
Press <return to accept the new transaction.
This transaction appears at the top of the screen with only
the date and the balance is unchanged.
Regularly scheduled payments
Now we will look at regular payments. This function may or
may not be useful to you.
The message section is asking for the number of regular
payments. Enter 3<return>. Not that three transactions were
generated by the program.
The auto payment function is required to makes several
assumptions any or none of which may be true.
1) The normal payment amount is the amount entered at the
beginning of the session.
2) The interest rate will not change.
3) The normal payment date is one month, or year, or
quarter, from the date of the current transaction. That
is the day the payment is due, the 10th, 15th, 21st,
etc. is the same as the day date of the current
payment.
The only assumption you can adjust is the day date. Assume
the current transaction date is 03-15-88 and the regular payments
are due on the first of each month.
Accept the current payment and request no automatic
payments. Enter the next regular payment manually. Enter the date
as 040188, the payment amount as the regular payment amount and
then accept the payment. Now the current date agrees with the
regular payment schedule and you can request any number of
regular payments. (Up to the limit imposed by your computers
memory.) (Most computers will hold 1000 or more, this should not
be a problem.)
Ending data input.
Line of Credit, Interest Check page 8
At some point you will be faced with a blank screen asking
for a transaction but you will not have any more transactions to
enter. Look at the schedule above and reenter the last date. If
you have followed these instructions exactly, this should be
062188. If not, reenter the date on the bottom line of the
schedule displayed on the top third of the screen. Press <return>
repeatedly until you get the accept/edit menu message in the
message area. Press F9. You will again be asked for regular
payments. Press <return>.
You are now back at the main menu.
*********************************************************
NOTE - WARNING - NOTICE - BEWARE - CAUTION - ETCETERA - !
*********************************************************
IF YOU WANT TO SAVE THIS SCHEDULE YOU MUST PRINT IT NOW !
*********************************************************
NOTE - WARNING - NOTICE - BEWARE - CAUTION - ETCETERA - !
*********************************************************
Printing the schedule
To print the schedule, select option 2 from the main menu.
BE SURE THE PRINTER HAS PAPER AND IS ON LINE
Line of Credit, Interest Check page 9
