Lender Spreadsheet provides you with a detailed Payoff Statement that you can easily generate with a little guidance from you.
The Payoff Statement includes all outstanding interest and late/bad charges, so if your borrower has not made all their payments or paid their late fees, you won't lose out.
The following topics provide step-by-step guides on what can happen when your borrower pays off. These include:
For loans Originated 1st of the Month:
Firstly, remember how mortgage payments are applied
Mortgage payments are made at the end of the month that they apply to. So a payment received on March 5 covers interest for February.
If your borrower wants to payoff on April 2, you would need to accrue the interest for the whole of March + 2 days of April.
Two simple rules:
Click on the Payoff worksheet.
We are assuming that all payments are entered correctly at this point. Please make sure they are BEFORE you create your Payoff or it will not be accurate.
To start, simply enter a date in Cell G2.
You can enter any additional charges that are due at Payoff in Cell G4. For example, legal fees or insurance you've paid on behalf of the borrower etc.
As soon as you enter a date, the Payoff will populate its fields.
There is a section to the righthand side of the screen which includes further information about the Payoff and further options.
There is a dropdown on the bottom right, which gives you the option of cancelling any Late charges for the CURRENT Payoff month. This is ONLY for the Payoff month, if for example you wish to not charge a further Late Charge as the Payoff is taking longer than expected due to some unforeseen circumstances. This will NOT change any previous outstanding Late Charges that you have accrued.
If you select Yes on the dropdown, then you'll notice that the Late Charge that in the picture above is due from May 11 2021 is now removed.
We don't recommend forgiving late fees as good lending practice, but there is the option if you need it.
In our example below, we have accrued a payment that was not received on May 1 2021, but we've also stated we want the Payoff Start Date to be May 1 2021.
You either need to change the Payoff Start date to AFTER the date of the last payment or the date it is accrued OR, change the date of the last Payment or the date it is accrued.
You will also likely see the warning box below to remind you when entering the Payoff Start Date.
If your borrower has not sent a payment for their final month and you are collecting it at Payoff, you do not need to accrue that payment. All you have to do is make sure all previous payments are entered or accrued.
Get in touch if you’re having problems, need something specific or have questions about our spreadsheet.
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