...incomprehensible to the common man. The hirer is entitled to a statutory rebate for terms charges and unexpired insurance. The statutory rebate for terms charges is calculated using a formula derived from section 2(1) of the Act. Simplified, the formula is as below: I X | (N) (N+1) | | (T) (T+1) | Where: I = amount of interest charged N = number of installments still to go T = total number of installments in the agreement * Car Purchase Price: RM100,000 * Deposit: RM10,000 * Loan Amount: RM90,000 * Interest: 10% (flat term charge) Let’s take a hypothetical example: Sarala has to pay a total of 60 instalments in a hire purchase agreement and she is charged an interest amount of RM45,000 (total interest for 5 yrs/60 months) for the whole period. She has already paid up 12 instalments before she decided to complete the purchase — early settlement. The statutory rebate for terms charges she is entitled to is: RM45,000 x (48) (48+1)/(60) (60+1) = RM28,918.10 Conclusion Indeed, the Rule of 78 was used in Indiana since 1935. It is commonly accepted and still widely used to calculate the rebate or interest portion in an installment payment. Nevertheless, there are some limitations, i.e. this method only works with the assumption that there are no other variables such as late payment interest, other charges and other forms of interest in rebate calculations. In other words, if a hirer pays his car loan (hire purchase) diligently without any default on or before the payment...
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...Executive Summary This report aims at providing an overall analysis of the repayment behavior of the SME loan borrowers of Brac Bank Limited. Before going to the analysis, it is mandatory to know something about the organization, its core products that it offers to its customers; about the SME loan, its classifications and the whole of its process starting from loan sanction to recovery and closing of the loan. That’s why, first of all, I made an overview of the organization, BRAC bank Limited, where I had completed my internship program. Here I tried to focus the bank’s history of origination, its mission and vision, major departments and business units and major products and services. Then I said something about Asset Operations Department, the department where I was to perform my job responsibility. SME is the next section where I gave my concentration. Here I focused on the terms and conditions of giving SME loan, enterprise selection criteria and documentation. Then talked about the procedure of SME loan where I delineated the sanction, disbursement, repayment and closing of SME loan. After talking about the whole process of SME loan, I made an attempt to analyze the repayment behavior of SME loan borrowers. For this end in view, I have collected information about 20 SME borrowers. Then I have chosen eight major variables which have an impact on the recovery rate of SME loan. That is, these are the variables which may change the repayment behavior of SME borrowers...
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...SAFE AND SECURE A security instrument accompanies (or should accompany) every Promissory Note. The security instrument is state specific, and examples include mortgage, deed of trust, security deed, or trust deed. The security instrument identifies and encumbers the real property used as collateral for the note. It is notarized and recorded with the county in which the property is located. Once recorded, it secures an interest in, or lien against, the property. In title theory states, a mortgage is used and it conveys ownership to the lender. A clause in the mortgage provides that title reverts back to the borrower when the loan is paid. In lien theory states, the mortgage creates a lien only on the property and the title remains with the borrower. The lien is removed when all the payments have been made. With a Deed of Trust there are three parties involved; the Trustor (borrower), the Beneficiary (lender or note holder), and the Trustee (third party holding title to the property, normally a title company or attorney). With a mortgage document, there are only two parties involved, the borrower and the lender. With a Deed of Trust, the borrower conveys title to a trustee who will hold title to the property for the benefit of the lender. The title remains in trust until the loan is paid. Certain language is vital in a security instrument. When reviewing, look for the following terms: Due on Sale Clause: This clause allows the (note holder, lender, etc.) to...
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...Suggestion as Butler’s financial advisor Butler Lumber Company is on a growing path. It is evident from the case that the volume has been built due to successful price competition, careful control of operating expenses and purchases at substantial discounts. Even in case of an economic downturn its business is protected to a large extent as 55% of its sales are from the repair market. The company is growing at a good pace of 19%, 34% and 34% for the year 1989, 1990 and 1991 respectively. The data is tabulated below. % increase in sales of Butler Lumber Company Net Sales 1988 1989 1990 Expected 1991 1991 first quarter 1697000 2013000 2694000 3600000 718000 Increase NA 316000 681000 906000 % Increase NA 18.621096 33.830104 33.63028953 All amounts in $ The company has a considerable amount of debt also which is tabulated below Current outstanding debts of Butler Lumber Company Particulars Year 1991 Notes Payable, bank 247000 Notes Payable, trade 157000 Accounts payable 157000 Accrued expenses 36000 Total Debt 597000 All amounts in $ As his financial advisor I would suggest Mr. Butler to go for this loan amount. This would help in meeting the expansion and sustaining the growth of his company. Even though the operating expense for 1990 is 658000 and a purchase of 2042000 which is an increase of 34 % and 27.7 % over the previous year, respectively the growth is promising. The amount of $465000 might be needed in...
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...When the automotive industry began to fail, the US Treasury increased the interest rate on Treasury bills as a way to bring more money back to the government. As you can see from the graph, in 2009 a 1 year Treasury bill had an average interest rate of 0.55%. Throughout the short recession, the interest rate remained above 0.20% because Treasury bills were not in high demand. People had their own financial troubles, so very few could afford to send money to the government. In the first few quarters of 20122, you can see a drop in the interest rate. This was a result of the recession coming to an end. More people were able to buy Treasury bills, lowering the interest rate. In early 2012, the interest rate rose slightly, then dropped off to 0.12%, where it has remained steady since. Taking a look at the four week, three month, and six month Treasury bills, you can see the same trends. In the first quarter of 2011, the four week bill dropped substantially, from 0.10% to 0.02% and remained there until the economy began to pick back up. Notice the steady rise during 2012, and then another drop off during the second quarter of 2013. This means more people were buying Treasury bills. The three and six month Treasury bills were very similar during the recession. At the beginning of 2009, those bills were relatively high in interest rates. As there was a larger demand, the interest rates began to drop off, until 2012, when demand eased up and the interest rates began to rise again....
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... Eligibility criteria for this program consists of the following: * Individual must contract for the LRP as a non-prior service accession for a 3 or more year term of service into the active force * must disenroll from Montgomery GI Bill in writing, using DD Form 2366 * contract as a member in an officer candidate program or contract for a selected MOS * possess a loan that was made, insured, or guaranteed under the Higher Education Act of 1965, Title IV, Part B, D, or E prior to entering active duty have LRP guaranteed in writing in the enlistment contract (DA Form 3286-66) * have an Armed Forces Qualification Test score of 50, or higher on the ASVAB * enlist with a high school diploma * loan can’t be in default before entering active duty and during the repayment process Loans that qualify for repayment * any loan made, insured, or guaranteed under part B of title IV of the Higher Education Act of 1965 (20 U.S.C. 1071 et seq.); * any loan made under part D of such title (the William D. Ford Federal Direct Loan Program, 20 U.S.C. 1087a et seq.); * any loan made under part E of such title (20 U.S.C. 1087aa et seq.); or * any loan incurred for educational purposes made by a lender that is – * (i) an agency or instrumentality of a State; * (ii) a financial or credit institution (including an insurance company) that is subject to examination and supervision by an agency of the United States or any State; * (iii) from...
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...the borrower, the interest rate, if any, and the terms of payment. The note can be formal or it can be handwritten, dated and signed by the borrower. As long as there is a promissory note, the company should record the amount owed in the notes receivable account in the general journal. Any company, a sole proprietorship, a partnership or a large corporation can issue promissory notes and record the transaction in a notes receivable account. Companies that make Employee Advances If a company makes it a practice to advance wages to an employee, that company might ask for a signed promissory note that details how the employee will repay the advance. The amount of money the employee now owes qualifies as a notes receivable. Companies with Default Accounts Although any company or individual can ask a borrower to sign a promissory note, in small businesses that sell goods or services on account a promissory note can replace a previous agreement to pay. For example, if Mr. Jones purchases $1,000 of food on account from a local grocery store, the store might expect him to pay off his...
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...cushion in place, just in case you are not fortunate enough to fall into a high paying position straight out of college. (c) USA TODAY, 2011 Colleges offer grads help repaying loans Authors: Mary Beth Marklein; USA TODAY Source: USA Today; 06/13/2011 There are options available to you if you’re having trouble repaying your student loans Times are rough, employment is down, and finding a job after you graduate from college may not be as easy as expected. Although most Federal student loan programs offer a 6 month grace period, after you graduate, before you have to start repaying your loans … in these times, you may need more time than that. In this case, there are options out there, to help you stay on track and not fall into default on your loans. Forbearance, Deferment, Extensions, and Income based repayment programs are all options worth looking in to if you are struggling with repaying your student loans. You just need to keep in mind that, unless your loan was a subsidized loan through the Federal Government, your interest will continue to accrue during your deferment or forbearance periods. Loans acquired via private lenders may not be as easy to work...
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...SECURED PROMISSORY NOTE (AMORTIZED PAYMENTS) $__________________[Amount of Note] This promissory note (the “Note”) is made and effective _____________ [Date], by and between ____________________, an [individual] [corporation] [limited liability company] [etc.] (the “Borrower”), and _______________________, an [individual] [corporation] [limited liability company] [etc.] (the “Payee”). 1. PROMISE OF PAYMENT. FOR VALUE RECEIVED, the Borrower promises to pay to the Payee, at _______________________ [Address], _________[City], ___ [State] __________ [Zip Code], or at such other place as the Payee may designate in writing from time to time, the principal amount of _________________ Dollars ($_______), together with interest accruing on the unpaid balance thereof until due. The interest rate on this Note shall be an annual rate of interest equal to [Rate] ([Rate]%) percent, or the maximum amount allowed by applicable law, whichever is less. Interest shall be computed on the basis of a year of 365 days and the actual number of days elapsed. 2. MONTHLY INSTALLMENT PAYMENTS. The Borrower will pay said principal and interest to the Payee in equal installment payments of _______________, on the ____ day of each month, until the principal and interest have been paid in full. [INSERT OTHER PAYMENT SCHEDULE AS AGREED] Payments shall be to the Payee’s address as designated above. All payments will be applied first to interest and the remainder to principal, and interest...
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...installed on it: chetstriker getreccalls To view sent call logs (even deleted): chetstriker getsentcalls To view received SMS logs (even deleted): chetstriker getrecsms To view sent SMS logs (even deleted): chetstriker getsentsms To change log size (for calls and sms, default:10 min:5 max:25) chetstriker logsize number_between_5_and_25 To test if phone creeper is running (discreetly): helo chetstriker turnonringer To retrieve the external IP Address of your phone, assuming connected: chetstriker getip To receive last 10 call logs(even if deleted): chetstriker getcalllogs To receive live SMS notifications on SMS and CALL transactions: chetstriker liveon To turn off live notifications: chetstriker liveoff To lock PDA: chetstriker lock To run a program (exec is the program name): chetstriker run exec To run a program (exec is the program name, arg is any arguments added): chetstriker run exec | arg To setup FTP account to retreive without SMS (make sure you add space | space in between): chetstriker setupftp url @ user @ pass To setup FTP account (use this if not using default port 21): chetstriker setupftp url @ user @ pass @ port To setup FTP account (use this if ftp not saving to default base path): chetstriker setupftp url @ user @ pass @ port @ ftp_path To receive any log by ftp, you can pre-seed any get command with ftp: example: chetstriker getcalllogs would become chetstriker ftpgetcalllogs To add call blocking: (communication either way...
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...PLEDGE A pledge is a special type of bailment in which a person temporarily transfers the possession or ownership of his/her property in order to secure a loan from the other person. It is defined as in the Indian Contract Act, 1872, as “The bailment of goods as a security for the payment of a debt or performance of a promise is called pledge. The bailor in this case is called a Pawner and the bailee is called a Pawnee.” Essentially, when the purpose of the bailment is to secure a loan, it is called a pledge. This article is concerned specifically with Section 176 of the Indian Contract Act, which deals with the pawnee’s right to sue or right of sale in case of the pawner’s default. The essential ingredients that are required to constitute a pledge are as follows: 1. Delivery of possession – As in bailment, the delivery of possession is essential in a pledge. Thus, in the case of Revenue Authority vs Sudarsanam Pictures, a film producer borrowed a sum of money from a financier and agreed to deliver the final prints of the film when they were ready. This was held not to be a pledge because there was no delivery of possession at the time of the agreement. It is also possible to let the pawner keep the physical goods even though the legal possession is transferred to the pawner. Thus, in Bank of Chittor vs Narsimbulu, a cinema hall equipment was pledged to the bank but the bank allowed the hall owner to keep the equipment to show the movies. The hall owner then sold the...
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...repayment of their loans and some borrowers were actually in default. This is a disturbing trend, particularly when compared to consumer debt in general which is at 4.8% and includes credit card, auto loans, mortgages etc. In other words, student loan borrowers even with deferment, lower payment options and other federal student loan options are more than twice as likely to be seriously delinquent with repaying their student loan. Many studies indicate...
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...time-to-maturity of T.By put-call parity,the value of the firm’s debt is equal to the value of a risk-free discount bond minus the value of a put option written on the firm with a strike price equal to the face value of debt and a time-to-maturity of T. To some extent,our calculated probability of default is reasonable.In fact,dynamics of default probability comes mostly from the dynamics of the equity values.KMV model can always quickly reflect deterioration in credit quality.Normally, changes in EDF tend to anticipate at least one year earlier than the downgrading of the issuer by rating agencies such as S&P’s and Moody’s.It recognizes that the market value of debt is unobservable and thus use equity to infer debt value. The calculated probability of default is more related to the firm’s characteristics than credit rating approach and thus more sensitive to change in the quality of obligors.Because stock price information is predictive and highly responsive, the use of market information to compute credit risk can gain more accurate result. However there are also some weaknesses of this approach that may lead to the inappropriate probability of default.Our estimation of probability of default requires subjective estimation of the input parameters.We estimate volatility of equity from historical stock returns data and thus the market value and volatility of the firm’s asset,assuming one year forecasting horizon.Because...
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...otherwise been considered absent the fee (for example, certain syndication fees addressed in paragraph 310-20-25-19) e. Fees charged to the borrower in connection with the process of originating, refinancing, or restructuring a loan. This term includes, but is not limited to, points, management, arrangement, placement, application, underwriting, and other fees pursuant to a lending or leasing transaction and also includes syndication and participation fees to the extent they are associated with the portion of the loan retained by the lender. Provision 2) > Non-Performance-Related Default Covenants 05-8Some lease agreements contain default provisions that are unrelated to the lessee's use of the property, such as financial covenants (for example, maintenance of certain financial ratios related to the financial condition of the lessee). The remedies for default might include the right of the lessor to put the property to the lessee or a requirement that the lessee make a payment to the lessor. See related guidance beginning in paragraph 840-10-25-13. Provision 3) e. Fees that are paid by the lessee to the owners of the...
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...Basis for Loan Classification (BRPD Circular # 05 dated 05-06-2006): |Categories of Loans |Past due/ Overdue |SMA |Sub-standard |Doubtful |Bad/Loss | |Continuous Loan |If not repaid/renewed within the fixed |Overdue for a period of |6 to less than 9 months |9 to less than 12 months|12 months and above | | |expiry date for repayment will be treated |90 days i.e. 3 months or| | | | | |as past due from the following day of the |beyond but less than 6 | | | | | |expiry date. |months | | | | | |If not repaid/renewed within the fixed |Overdue for a period of |6 to less than 9 months |9 to less than 12 months|12 months and above | | |expiry date for repayment will be treated |90 days i.e. 3 months or| | | | |Demand Loan |as past due from the following day of the |beyond but less than 6 | | | | | |expiry date. |months | ...
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