Several payment methods can allow for loan amortization. Some use two methods combined, while the loan starts to amortize by one, and in the course of the loan’s life, the method changes. Here is a spotlight on the Reallocated schedule payment method, which initial uses scheduled payments and then switches to allocated level pay.
Users choose the Reallocated schedule payment method from the Principal payment method drop-down list within the Loans editor. The user will specify the payment of Scheduled payments to start with in the Scheduled payments column.
The exact time when the switch to allocated level pay takes place is specified by the number of months in the Month to Reamort column. Once the loan reamortizes, it starts a new "allocated" year from that point and calculates the allocation for that year. The month used going forward is the month that the loan switched to allocated level pay.
Cash Flow Report
The Cash Flow Report will demonstrate an amortization of the same amount per payment for the defined amount of months. Then the payments will be allocated level paid each year.