Understanding Loan Billing Statements

Related Topics

Statement Generation

The report rules for the Loan Billing Statement Report 462 are set up to run daily. Each night statements will generate for those members that meet the lead day criteria or the immediate generation criteria. The information for a single loan will be displayed on a statement. If a member has multiple loans they will receive one statement for each loan.

Loans with weekly, bi-weekly, or semi-monthly payment frequencies will receive a statement at month end. The system will not use the lead day criteria on loans with a payment frequency less than monthly. Loans with quarterly, semi-annually, or annual payment frequencies will be subject to the normal lead day criteria for statement generation.

A statement will generate every month regardless of the payment due date. The system uses the statement generation cycle to determine if a payment is due for the current statement period. If the loan due date has advanced to a point where the member will receive future statements prior to that due date, then the current statement will show $0.00 due in the current amount due field. The payment amount will be reflected in the current amount due area only when the loan due date falls prior to the next statement generation date.

Lead Day Criteria

Lead days are used during the creation of the Loan Billing Statement. The Statement/Cyclical Lead Days field tells the system how many days prior to the payment due day that the statement should generate. The system does not consider the month portion of the payment due date when calculating the statement generation lead times. (Loan Profiles - Account Information tab and Recalculations tab)

For example, if Loan Billing Statements were turned on for a credit union on October 1st with a 24 day lead day designation the statements would generate as follows:

  • October 1st: Members due for the 25th of any month
  • October 2nd: Members due for the 26th of any month
  • October 3rd: Members due for the 27th of any month

Cyclical Recalculation

Cyclical recalculation may be turned on for all payment types except 001 and 009. This option will synchronize the payment recalculation by back office with the statement generation. Back-office recalculation is no longer isolated to month end for loan types receiving Loan Billing Statements. For payment types other than 001 and 009, if cyclical recalculation is not selected, Loan Billing Statements will produce at month end. (Loan Profiles - Recalculations tab)

461 Report Loan Notices

The Loan Payment Recalculation Notices Report 461 should be turned off on every loan type where the Loan Billing Statement is producing. Continuing to produce the 461 Notice is a duplicate effort, since the Loan Billing Statement provides the same information as this notice. (Loan Profiles - Recalculations tab)

469 Report Loan Notices

The Adjustable Rate Loan Notices Report 469 can also be turned off if the credit union desires. If the loan type uses rate option D or payment type 009, the Loan Billing Statement will disclose the rate change if it is pending on the members account at the time the statement is generated. The credit union should discuss the option of turning this notice off with their Loan Billing Statement Implementation representative so they can make an informed decision. (Loan Profiles - Recalculations tab)

Coupon Options

Coupon books must be turned off for all loan types using the Loan Billing Statement option. (Loan Profiles - Account Information tab)

Statement Options

The credit union will define the statement option and line of credit option for each loan type during implementation. These options can be reviewed on the Loan Profiles - Account Information tab. The Statement Print field will be Loan Billing Statement only (Option S). The second field determines if a statement will print for zero balance line of credit loans. (Loan Profiles - Account Information tab)

Exclude from Loan Statement

A loan can be excluded from receiving a statement at the note level. This is useful for accounts where a bankruptcy is in progress or the credit union has other reasons to suppress statement generation. The Exclude from Loan Statement check box should be monitored with a Reporting Analytics query on a regular basis to ensure that the exclusion flag is set correctly for each note. The Statement Print field on the Loan Profiles – Account Information tab indicates if the loan will be reported on a (1) loan billing statement, (2) regular periodic statement, (3) mortgage loan statement or (4) no statement. Caution should be used when selecting the Exclude from Loan Statement check box. If the Exclude from Loan Statement check box is selected for a loan type set up with a Statement Print field of S-Loan Billing Statement only, the member’s loan will not print on any statement, including the member statement. This is a potential compliance violation. This check box should only be used when the loans excluded from receiving loan billing statements are loans that are designated not to receive any statements. (Loans - General tab)

Loan Billing Statement Report 462

  • The loan nickname and/or the late charge grace day value can be displayed on the member’s statement.
  • Loan Billing Statements are not available in electronic format at this time.
  • The statement message can be accessed in Portico on the Statement Messages window.
  • There are two credit union-defined messages on the remittance portion of the statement. The first message CO appears on the face of the remittance coupon and the second message BC appears on the back of the remittance coupon. These messages are not available in the Portico system and will not appear on the Nautilus Essentials statement copy. The credit union must contact FOS directly to make changes on these messages.

Nautilus Essentials

  • Loan Billing Statements are available in the 462 and 462E repository under the Statement search selection.
  • The Nautilus Essentials copy of the statement will show the full member number on the account. The secure member number, credit union logo, and the remittance messages options are added by Fiserv Output Solutions (FOS) and will not be visible on the Nautilus Essentials copy.

Frequently Asked Questions

Question: Why is there an ** after the note number on this statement?

Answer: Loan Billing Statements were designed for use on both open-ended and closed-ended loans. We were required to differentiate between open-ended and closed-ended loans on the statement. The double asterisk after the note number indicates that a loan is open ended. The disclosure information tied to these asterisks is printed on the final page of the statement (usually on the back side of the statement).

 

Question: Why doesn’t the Nautilus Essentials copy of the Loan Billing Statement showing my credit union logo or the messages on the remittance coupon?

Answer: These features are applied to the statement by FOS. They will not be visible on the Nautilus Essentials copy.

 

Question: The member received their Loan Billing Statement but the “Current Amount Due” and “Total Due This Statement” shows $0.00 due. Why doesn’t the statement show a payment amount?

Answer: The loan is considered paid ahead by the system. This means the members due date is set in the future and they do not need to satisfy a payment for this billing cycle. The payment amount will display in the upper right corner of the Loan Billing Statement for informational purposes only.

 

Question: This member has a semi-monthly payment frequency. Why are they not receiving a loan billing statement for each scheduled payment?

Answer: When a loan's payment frequency is less than monthly (weekly, bi-weekly, or semi-monthly) the member will receive one Loan Billing Statement each month at month end. The statement will reflect the due date on the Portico system at the time of statement generation.

 

Question: Why is this member’s loan not showing on the Members Combined Statement?

Answer: If the Statement Print field on the Loan Profiles – Account Information tab is set to S – Loan Billing Statement Only, the loan will not be included on the Members Combined Statement.

 

Question: Why is this member not receiving their loan billing statements?

Answer:

  • Is a copy of the loan billing statement available in Nautilus Essentials? If yes, then a statement was created and mailed to the member. We mail out all statements including those with foreign addresses. The only statements returned to the credit union are those with a 00000 member zip code.
  • Is the Exclude from Loan Statement check box selected on the Loans - General tab for the member’s loan?
  • Are loan billing statements turned on for the loan type?

 

Question: Why can’t I retrieve Loan Billing Statements through Portico?

Answer: Is the issue isolated to one member? Loan Billing Statements for credit union employees could be saved in a 462E file which will require the same security tokens necessary to access as the 390E statements.

 

Question: The Loan Billing Statement shows the payment amount from Portico. The member has satisfied a portion of their payment, why doesn’t the statement show the outstanding payment amount?

Answer: Portico uses the Par Accumulation bucket to track partial payments on a loan. The Loan Billing Statement only looks at this field when calculating the amount past due for the loan. At this time, the Par Accumulation value is not considered when the member is current on their account.

 

Question: Why did our member receive a statement on a zero balance loan when our loan profile states that zero balance statements should not be created?

Answer: There are a couple of situations that could cause a statement to generate for a loan with a zero balance:

  • A loan paid off during the month will create a statement with a blank payment due date, current amount due, or total due this statement.
  • A new loan booked on the system with a zero balance will receive a statement.
  • A loan type change or other transaction that updates the last financial transaction date on the loan record will prompt a statement to generate on open-ended loans regardless of the loan balance.

 

Question: Why does the “Current Amount Due Payment Detail” information print on some member statements and not others?

Answer:

  • On payment type 007 loans, the payment detail information will include a value for principal, interest, and escrow if applicable. These values are calculated during back-office recalculation and saved on Portico’s Payment Entry Details dialog box.
  • For all other payment types, this payment detail information will only print if the member has an escrow account associated with the loan. On these other payment types the principal and interest portion of the payment will be shown as a lump sum.

 

Question: Why do some statements designate Late Payment Fee Courtesy Days and others do not?

Answer:

  • Was there a recent change on the 462 Report Rules? If the Print Late Payment Courtesy Days value was changed recently, it would explain why some statements have information that other statements do not display. The value designated in the Print Late Payment Fee Courtesy Days is in effect for all the statements generated for the credit union.
  • Does the loan type profile include Late Charge information? If the credit union has Late Charges fee information set up at the loan type level and a Grace Day value of 0, the statement will display 0 for the Late Payment Fee Courtesy Days. If the loan type is not set up to charge a fee. then the statement will suppress the Late Payment Fee Courtesy Days field completely.

 

Question: Why do some statement have a loan type description, like HELOC, under the Note Number and others do not?

Answer: This loan description is pulled from the Description field on the Loan Profiles - Account Information tab. If the field is completed in Portico, the information will appear on the statement. If the field is blank, the statement will suppress the description.

 

Question: Why does a statement display a Past Due Amount field and others do not?

Answer: When a loan is delinquent, the Past Due Amount will be included on the statement. This field will not display if the loan is current.

Additional items that may appear on a Loan Billing Statement:

  • The Draw Period Expiration Date will appear on the statement if the loan type has a number greater than zero in the Draw Period field on the Loan Profiles - Account Information tab. The statement will display the date from the Draw Period Expiration field on the Loans - General tab.
  • Deferred late charges will print on the statement for 360-day interest loan types. This information will not be included on the statement if the late charge method is W – Based on Wisconsin late charge calculation.
  • The Remaining Number of Payments will print on the statement if the loan type uses payment type 006, 009, or 007 with calculations options 6 or 9. The value is pulled from the Remaining Number of Payments field on the Loans - Payment tab.
  • The loan final payment date will print on the statement if the account is a residual loan. Loan types are designated as residual types at the loan type level.

Informational messages that may appear:

  • * TOTAL DUE THIS STATEMENT EXCEEDS LOAN BALANCE. PLEASE CALL FOR LOAN AMOUNT DUE. This message will appear when the payment amount due exceeds the loan balance. An asterisk (*) will appear in the box labeled “Total Due this Statement”.
  • EFFECTIVE XX/XX/XX THE APR FOR THIS LOAN WILL CHANGE TO XX.XXX%. This message will print when the rate change option for a loan type is D or the loan uses payment type 009 and there is a pending rate change on the Adjustable Rate Information dialog box when the statement is produced.
  • DUE TO ESCROW ANALYSIS THE ESCROW PORTION OF YOUR PAYMENT WILL CHANGE TO XXX.XX EFFECTIVE XX/XX/XX. This message will print on escrow loans when the loan has a pending escrow change due to escrow recalculation.
  • THE CURRENT AMOUNT DUE PRINTED ABOVE INCLUDES AN ADJUSTMENT FOR ESCROW ANALYSIS EFFECTIVE XX/XX/XX. This message will print when a payment amount change goes into effect due to the escrow recalculation process.
  • EFFECTIVE XX/XX/XX THE PAYMENT AMOUNT FOR THIS LOAN WILL CHANGE TO XXX.XX. This message will print for payment type 009 loans when there is a recalculated payment amount that is effective after the next month-end cycle.
  • * LOAN FINAL PAYMENT DATE HAS BEEN REACHED. PLEASE CALL FOR LOAN AMOUNT DUE. This message will appear when the final payment date on a residual loan is equal to or less than the statement billing date. An asterisk (*) will appear in the following fields on the statement: Current Amount Due, Total Due this Statement and Amount Past Due (if the value is greater than 0.00).

    The Payment Amount field and the escrow messages listed above will always be suppressed if this message appears on the statement. If the loan meets the criteria to receive this final payment message and the “*TOTAL DUE THIS STATEMENT EXCEEDS LOAN BALANCE. PLEASE CALL FOR LOAN AMOUNT DUE” message, only the first message will print on the statement. The total due exceeds loan balance message will be suppressed.