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FASB 91 loan fee recognition and
reporting software
for
thousands of loans at the
same time
• Originated
and
purchased
loans
MBS,
CMOs Packaged Loans
MCA Merchant Cash Advances
•
New and existing loans
• Sold loans. Participations
and whole loan sales. Seasoned
loans, servicing retained.
• Effective Interest Rate Calculation for
all loans at the same time
• Utilize straight method for
designated loans
• 1 or
more user defined income, expense items per loan
• Amortize Income and Expense for any
month
• Amortize using:
Original principal balances, rates, fee amounts
and dates or
Current principal balances, rates and fee
balances
• Deferred fee income and expense general ledger Balances
• Accumulated and Book
Values
• Monthly Recognition and Totals
• Yearly recap
(calendar or fiscal) Recognition and Totals
including prior year(s) restatements
• Changes during term:
Effective interest rate recalculation due to
rate changes
Accelerated (additional) recognition of
deferral for paydowns, curtailments, payoffs
with recalculation of NPV (Net Present
Value)
Full recognition of deferral balance for early
payoff
•
Audit and exams:
Month-by-month
lifetime loan fee detail recognition schedules
• Reports:
View on screen
Send to local or network printer
Send to Adobe pdf
Send to Excel
Automatically import
loans from:
Excel worksheet
Service
bureau extract
Core
system download
Seller
service remittance
report ...
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Existing loans:
Use a Conversion file to preserve
fee income and expense balances
as of the conversion month:
• Convert at any time:
• Convert as of last month,
end of prior fiscal year, some
other month.
No Conversion fee balances?
• The software can amortize fees from the
loan's original date forward.
Been using straight line or another method on a Gross monthly fees basis?
• The software can distribute gross deferral
balances to individual loans
using Dollar Weighted principal
balances.
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Sold loans
Whole
and
participation
loans sold,
servicing
retained
• Sell loans for which you retain servicing
• New
loans
• Seasoned
loans
• 100% sale
• Percentage
sale
• Recognize
remaining
Deferral Balance
for all fees at
percentage sold
Example
for
participation
sold:
Sell 90% of a
loan
Deferral Balance
at time of sale
= 1,456.28
1,310.65 of the
Deferral will be
recognized in
the sale month
145.63 remaining
Deferral will
continue to be
amortized
A new Effective
Interest Rate
will be
calculated using
current loan
balance,145.63
deferral, payment
and remaining
term.
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Supports all of these
fee recognition methods at the loan
level:
• FASB 91 income, expense amortization over
Actual loan terms
Balloon terms
- Interest only, P&I
based on longer term,
fixed principal
reductions
Average portfolio life
Fee
amortization periods
reduced for other
reasons
• Straight line for
non-FASB applicable
• Other user defined methods
Amortize deferred fee income and expense for
• Mortgage loans
• Consumer loans
• HELOCs - use straight line
method for these, other or all
loans
• Commercial and other loans
• Secured, unsecured
• Purchased discounts/premiums at the individual
loan level
at the package
level
• Monthly, quarterly, semi-annual and annual
payments
• P&I amortizing
• Interest only:
As interest
only and
Interest with
periodic principal payments of a constant amount (e.g.,
$25,000 every three months)
• Balloons:
Interest only with
a balloon
P&I over balloon
period
P&I over longer
term such as 5 year balloon with 30 year P&I
P&I over average
portfolio life
• Constant $Amount payment, such as lease
payments
• % reduction of remaining principal balance,
such as 8.3% of this month's balance, then 8.3%
of next month's balance
• Fixed rate
• Zero rate
• Variable rate
• 360, 365, 366, 365/360
• FASB, GAAP compliant
• Customization available
Import and amortize loan fees from
• Core system, service bureau
Download your loan file
with current balances to
the software each month
• Seller servicer
remittance
reports
• Aires - credit union report
• Manually serviced loans
• Excel
A preformatted worksheet comes with the software.
Enter or copy loan data to the worksheet once
and the system takes care of everything else
or
import the worksheet each month with current
loan balances, rates, paid off loans, new loans
....
• Other files and sources
Accrual basis accounting
•
Fee Recognition is NOT based on payment
transactions
• Fee Recognition occurs every month regardless
of whether a payment was made because
interest income is accrued every
month.
New
and
Existing loans
For existing loans:
Retain existing deferral balances and start using effective interest method
forward.
Start now or as of a prior date.
Calculate income
and expense recognition
for
prior month(s), prior year(s).
Loan Fee Income
and Expense can be:
A) Known amounts which
are included in the loan
file.
B) Known amounts
which are not included in
the loan file.
The software can "match"
Fees from an Excel file
and assign them to each
loan during the import
process.
C) Gross amounts which need
to be assigned to each
loan:
Some fees might be
billed to you as a single
amount covering all
services for the month
(not broken down by
individual loan).
Simply assign a single
amount to be distributed
to some or all new loans.
The software will
calculate a Dollar
Weighted Average for the
sum of principal and
distribute the percentage
of applicable loan's principal
divided by sum and
assign the result.
D) Combinations of the
above.
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We
offer ....
1)
Software
Fee amortization
and accounting
reports.
Use the software
at your site.
2)
Outsourcing
Send a loan
file. Have
us:
Calculate effective interest rates, amortize fees and
return a set of
financial
reports,
One-time
basis for
current and
prior periods or
Recurring
monthly basis
Request more
information
Support@fdssi.com or
1-800-245-8444
3) Client
Modules
Need something
unique?
Special
interface?
Third party
servicing?
Participations
sold?
New loan product?
Recognition
method?
Interactive App?
Something else?
No matter what
kind of deferrals
you need to
amortize using
the effective
interest method:
Income
Expense
Discounts
Premiums
With multiple deferred amounts per record.
We can
create a
dedicated module
to meet your
requirements.
Request more
information
Support@fdssi.com or
1-800-245-8444
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Price and free demo |
Click to open and view Price page
which has a link to download a free demo zip
file at any time.
Free demo
includes:
• A live version of the software
• Sample records
• Ability to run all reports
Or contact us with any questions.
1-800-245-8444
Support@fdssi.com
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Already
amortizing
deferred
fees?
The
software
can
preserve
current
income
and
expense
deferral
balances.
No
adjusting
journal
entries.
The software can also amortize deferred
fees
from
original
loan
dates.
Customization available
Need something just for
your operation?
Many of our
clients had us modify
the software to satisfy:
• Hybrid lending products
• Special interface requirements
• Read this, export that functions
Use the software as a
"background tool" to
facilitate an internal
processing function
• New loan
programs
• Unique repayment methods
• Auditor requests
• Other proprietary, industry and competitive
needs
Click here to
Learn more
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Our clients needed a FASB 91
solution for ....
Additional
fees per
loan:
Client's servicing system could only amortize one
deferred
fee per
loan.
Our FASB 91 software can calculate individual effective
interest rates and recognize up to four
(4) unique fees per loan.
The software also provides individual lifetime month-by-month amortization
and recognition audit schedules for each
fee.
Client utilizes our software to amortize the additional
fees and account for general ledger P&L
and Balance Sheet reporting plus journal
entry support documents and postings. |
New type of loan offering:
Client was introducing a new loan product with
repayment activity for which their loan
servicing system was unable to comply
with FASB 91 recognition in a timely
manner.
We modified our software to accommodate their operational
and reporting
requirements well before the first loan
was put on the books. |
Manually serviced loans:
Client had a small portfolio of high balance, high
rate, short term loans which were not on
an automated servicing system.
Loans had various conditions including interest calculations of
both 360/360 and 365/360. Many
loans
were
short
term
balloons
with P&I
calculations
over a
longer
term.
Our software provided an solution to their FASB 91
reporting requirements which also met the
approval of their outside auditors. |
Due diligence, M&A:
Client was a CPA firm verifying whether a commercial
bank
under
acquisition
had properly recorded
loan fee
recognition.
As it
turned
out, the
bank had
been
immediately
recognizing
income
and
expense
for most
loans.
No
deferrals.
Our software was able to recalculate deferred loan fees
under FASB 91 and provide fee
recognition, P&L and Balance Sheet totals for
a
specified look-back period.
Services:
Inasmuch as a short time frame was involved for
completing this project, they sent loan
files to us for processing and we
returned desired reports in Excel
including
lifetime fee amortization and recognition schedules for
selected loans. |
Conversion to FASB 91:
Client had been calculating loan fee income and expense
recognition using the straight line
method.
Our software allowed the client to switch to FASB 91
recognition "as of" the end of their
most recent fiscal year using remaining
loan and deferral balances as of that
point.
The software also provided client the first year
difference between FASB 91 vs. Straight
Line by amortizing loans both ways for a
12 month period.
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Cash
payments vs. Accrued
Client's loan servicing system recognized deferred fees
with each cash payment. Fee
recognition did not sync with their
monthly loan interest income which was
cash plus accrued.
Our FASB 91 software is an accrual based system which
recognizes fee income and expense each
month regardless of payment activity.
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Capital management:
Client loans had semi-annual and
annual P&I payments. Also had
custom
notes
with fixed principal
payments due at various times during the
year.
Our software was able to meet their FASB 91
amortization
and reporting requirements. |
Independent comparison:
Client was uncertain their service bureau was properly
handling FASB 91 correctly for all of
their loan types, some of which actually
required a straight line method.
They used our
software to obtain parallel results,
including
straight
line for
applicable
loans. |
Special promotion:
Client wanted to "test the waters" with an unusual product.
Rather than incurring all the expense involved in
changing FASB 91 recognition using their
in-house system, they turned to us for an affordable,
immediate
resolution. |
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Price and free demo |
Click to open and view Price page
which has a link to download a free demo zip file at
any time.
Free demo
includes:
• A live version of the software
• Sample records
• Ability to run all reports
Or contact us with any questions.
1-800-245-8444
Support@fdssi.com
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