Adding Loan Expense Assumptions

You can set up and save sets of expense assumptions that the application uses to allocate expenses based on the type of loan and loan amount on the Loan Applications setup page.

1. Select Setup > Assumptions from the menu.
   The Loan Applications > Expenses tab is selected by default.
2. Select Add.
3. Enter one of the institution's loan types as the Name for the expense that you are creating.

   When the expense is saved, you can select it from the list.

   The next part of the setup process involves creating a series of origination and servicing expenses grouped by Up to Value. The And Greater grouping row appears automatically when you initially select Add.

4. Select Add Row to add the necessary number of rows for additional scenarios.
5. Complete the following fields for each new row:
   1. Enter an Up to Value for each new row.
   2. Enter the Simple Origination cost for simple loans.
   3. Enter the Simple Service monthly servicing cost for simple loans.
   4. Enter the Average Origination cost for loans of average complexity.
   5. Enter the Average Service monthly servicing cost for loans of average complexity.
   6. Enter the Complex Origination cost for complex loans.
   7. Enter the Complex Service monthly servicing cost for complex loans.

   The values entered in these fields are used to calculate the expenses allocated to specific types of loans based on the loan balances and the complexity of the instruments. A user-defined value is not required for every field.

6. Select Save.