This article provides an overview of how to create Variable Interest Rules. Variable Interest Rules tell the system how to compute interest on a deposit that is held on a transaction
Interest Processing Settings via System Default tab of Company Profile
- Interest Type (Variable) – ensure there is no check in appropriate box
- Initiate the flag labelled “Number of Interest Calculation Base Days are affected by Leap Year” if the current year is a leap year.
- Deposit Interest Check To: make your selection based on your companies Office Policies and Procedures.
To enter the Variable Interest Rules, go to File Maintenance / Variable Interest Rules, click on New and complete details as required.
- Rule Name – this should be a unique name to identify the rule.
- Process Fee – enter the numeric value as disclosed in the Agreement of Purchase and Sale and/or other legal documentation relating to the sale of this property.
- By default, the end date will be 9998-12-30 and cannot be changed
- Select to Save the Variable Interest Rule. To Edit and make changes, simply select the Edit button.
You may enter as many Interest Rules as required, one for last years transactions, one for G.I.C./Term Deposit, etc.
Editing/Deleting a Fixed Interest Rule
If you wish to modify a Variable Interest Rule, select this option from File Maintenance. Highlight Variable Interest Rule and click the Edit button. Make the desired changes and click the Save button.
To delete a Rule, highlight the Rule and click the Delete button. The warning screen will pop up to confirm your decision. Select OK to proceed or Cancel if you have changed your mind.
Additional Notes for Daily Interest Bearing Accounts
Interest on trust that has been deposited in a daily interest bearing account will need to be paid out at closing. If you have not received or reviewed an updated bank statement at the time of closing and unsure of the interest earned on the deposit, Back Office can accommodate this situation by using the partial payment transaction. Any transactions that have interest bearing status (as opposed to a Term Deposit/GIC) can be entered as a Partial Payment transaction. Because the deposit (and any interest) is attached to the Main transaction, this transaction can be processed separately from the secondary transaction. The secondary transaction (all commission related items) can be disbursed in entirety at closing. The Main transaction can be closed once the bank information is received, and interest checks and/or interest process fees can be disbursed at that time.