Loan Management: How does a loan get paid off?

There are generally three possible scenarios for an active loan to become paid off. 

1. All Payments Have Been Made by ACH on Happy Mango According to Schedule
2. Borrower Made a Self-Initiated ACH Payment to Pay Off the Loan on Happy Mango
3. Borrower Made an Early Payment to Pay Off the Loan Offline

In each scenario, enough payments would have been made toward the loan principal and the accrued interest.  In the first two scenarios, once the last payment has settled in the destination lender's account, the loan status will automatically change from Active to Paid-Off.  In the last scenario where the borrower has made the last payment offline, the loan officer will need to manually record this payment and transfer the loan from Active to Paid-Off.  

Move an Active Loan to Paid-Off Using the "Update Status" Button

To manually change an active loan status, you will need to click the blue "Update Status" button on the Loan Payment Schedule page to open a pop-up window.  Then follow the five steps below:

Step 1: Select "Paid-Off" in the "Update Status To" drop-down window 

Step 2: Enter the amount the borrower has made offline.  It is important to note that the amount entered must be no less than the "Amount to Pay Off".  If this amount is less than the "Amount to Pay Off", an error message will appear and no further action can be taken. 

Step 3: Enter the date when the payment is received. 

Step 4: Enter any notes if necessary. 

Step 5: Click the "Update" button to complete.

If the Paid-Off amount entered is greater than the sum of the remaining principal and the accrued interest, a negative balance will appear on the "Remaining Principal Balance" column on the Current Schedule tab.  The negative amount indicates how much the borrower has overpaid when paying off the loan.