Receive a loan payoff

A loan payoff is the final payment for a loan account. The payoff amount is the total of all outstanding amounts owed for the loan account: principal, interest (both due and accrued), and fees.

Posting the payoff for a loan account closes the account permanently. After a loan payoff is posted, it cannot be edited or deleted.

1. Go to Lending Management > All and select Add (circle) next to Payoffs.
   Alternatively, select Create on the Loan Payoffs page (Lending Management > All > Payoffs).
2. Enter the Receipt date.

   The receipt date must meet the following requirements:

   • The date must be within an open period.
   • The date must be within a GL period that is opened.
   • The date must be within a period for which interest and statements have not been generated.

     If you need to post transactions to a period for which interest and statements have been generated, you can reverse the interest and statements for selected depository accounts. For those depository accounts, you can then post transactions to the period. Learn about reversing interest and statements.

   • The date cannot be prior to the latest transaction date.

     You can find the latest transaction date on the Transaction History tab of the Loan Account page. Learn how to view the transaction history for a loan account.

   The receipt date is used as the journal entry transaction date in the general ledger. It is also used as the deposit date and the transaction date for the other cash receipt that's created for the payment in Cash Management.

3. Enter the Customer.
4. Enter the Loan account.
5. Enter the Payment method.
6. Specify how to deposit the payoff:
   1. In the Deposit to field, select the type of account to use:
      • Bank account: Select this if you already deposited the receipt.
      • Undeposited funds: Select this if you're accumulating receipts for deposit.
   2. In the related account field (which changes based on what you select in the Deposit to field), enter the specific account to use:
      • Bank account: Enter the bank account used for the deposit.
      • Undeposited funds account: Enter the GL account for undeposited funds. This account cannot be associated with a bank account. It must be an account that can be used as a transfer account so that the funds can be deposited later.
7. You can review information about the loan in the Current loan balances section.
   For non-revolving (amortized) loans, this section includes extra fields that are not shown for revolving (non-amortized) loans:

   • Principal due
   • Interest due
   • Payments remaining
8. In the Payoff section, confirm the Payoff amount, which is the total of the other amounts shown in this section.

9. Select Post.

   Posting creates the following transactions:

   • Loan payoff transaction in Lending Management.
   • Other cash receipt in Cash Management. Learn more about other cash receipts.

   The loan account is now fully paid off. Its state changes to Closed pending. No more interest will be calculated or posted for the account, and transactions can no longer be posted for the account. When the final statement for the loan account is generated, its state will change to Closed and its status will change to Inactive.