Entering a pre-existing loan with customized payments Follow

In some cases, you may have a loan that exists before the start date of your forecast, and you need to represent a specific payment schedule for that loan, such as interest-only payments or a balloon payment.

For this scenario, you'll need two separate loan entries in your forecast:

  • One entry to represent the pre-existing balance
  • One entry to represent the payment schedule

In the example below, we're representing a pre-existing loan with a balance of $50,000, which has 10% interest. As of the start date of the forecast, we'll make interest-only payments on this loan for 12 months, and then begin making payments against the principal.

 

Entry #1: pre-existing loan balance

    1. In the Forecast tab, click Financing:
      forecast-menubar-new-financing.png
    2. In the Financing page, click the Add Loan button:
      deferred-interest-int-seg-buttons.png#as
    3. Give the loan a name. Then choose Before the plan start date from the pull-down menu:
      pre-existing-loan1.png
    4. Enter the amount you owe. Then under How many payments remain as of your start date, enter 1. Enter a 0% interest rate. Then click Save & Close:
      pre-existing-loan-int.png
Note: we will represent the 10% interest on our loan in the next entry. The purpose of this entry is just to show the loan as pre-existing the plan's start date.
  1. As you can see in the table below, the pre-existing balance is now represented, and in the following month there's a payment of the loan in full. We'll represent the rest of this scenario in the second loan entry.
    pre-existing-loan-openbal.png

 

Entry #2: payment schedule

In order to enter this payment schedule into the forecast, we'll need to know two things ahead of time:

  • The amount of the interest-only payments
  • The amount of the interest-plus-principal payments

If you aren't sure of these amounts, you may want to consult your lender, or do an online search for a loan payment calculator.

  1. In the Forecast tab, click Financing:
    forecast-menubar-new-financing.png
  2. In the Financing page, click the Add Other button:
    deferred-payments-1.png#asset:2154
  3. Give this segment of the loan a name. Click Next:
    pre-existing-loan5.png
  4. Enter the correct interest rate. Then select No, or I'm not sure. Click Next to continue:
    pre-existing-loan6.png
  5. In the next overlay, enter the full amount of the loan balance (from Step 1) in the first month. Click Next:pre-existing-loan7.png
  6. In the last entry, enter your payment schedule. In the example below, we've entered interest-only payment amounts in the first year.
  7. Starting in Year 2, enter payment amounts for your interest-plus-principal payments. Then click Save & Close.
    pre-existing-loan-payment-month1.png

In the table below, you can now see the interest-only payments, followed by the interest-plus-principal payments:

pre-existing-loan-final-table.gif

Note: LivePlan rounds all amounts to the nearest dollar, so you may need to slightly adjust the amount of some interest-only payments in order to keep the full balance of the loan intact. 

 

More on customized loans:

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