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Promised Payments - Step By Step

What is a Promise? A Promise is an agreement with a debtor to pay a specific sum of money on a definite date. A promise may be a single payment, multiple payments or a repeating payment at a regular interval. This is recorded in Collect! using a Promise contact. The Promise Contact keeps track of when the promise is due and whether it is met or broken.

When you have proceeded through the steps below:

  • You should be more familiar with the concept of promises
  • Be able to start a single promise on a Debtor
  • Be able to start a repeating promise on a Debtor
  • Be able to automatically track a promise and any account activity regarding the promise.

We will cover:

  • Single Promise
    - Creating a Promise Contact
    - Viewing the Debtor form
    - Loading the WIP List

  • Posting Promised Payments
    - What Collect! does when you post a payment for a promise
    - When an NSF Check is returned

  • Multiple Single Promises
    - Creating multiple single promises

  • Repeating Promises
    - What is a repeating promise?
    - Creating a repeating promise
    - Viewing the Interest Detail form

  • Special Settings
    - Automatically Manage Promises
    - Advance Overpayments
    - Max Intervals
    - Grace Days
    - Promise Contact Actions
    - Payment Values

Single Promise

When you receive a promise from a debtor to pay a certain dollar amount on a specific date, you can create a Promise contact to keep track of the agreement. When a payment is received, Collect! will mark the contact as Done.

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Creating A Promise Contact

To enter a Promise Contact for an account, we must first open the Contact form while on the debtor's account.

1. Once the Debtor form is displayed, select the field labeled Owing. This will display the Debtor Financial Summary.

2. Select the PROMISE SCHEDULE button on the Debtor Financial Summary. You will be prompted to create a Promise.


Prompt to Create a Promise

Select YES to display a new Contact form.

tip.gif The Contact form will display, filled with any defaults, such as Priority and Delays Days, that have been set in the WIP Options.

You will notice that the Debtor's Name and Due Date are entered automatically. The Due Date may be in the future if you have "Delay Days" set in the WIP Options form. As well, the default contact Type field should already display "Promise."

5. If needed, you can select the field labeled Type to view the list of Contact types. Use the PageUp or PageDown key to see the whole list. Select PROMISE from the list, if it is not already displayed in the Type field.

6. The Contact's Due Date determines when the promised payment is due. The default is today, but the Due Date may be in the future, if you have "Delay Days" set in the WIP Options. Select the Calendar icon to the right of the Due Date field and choose the date the payment must be made.

7. Locate the field labeled Repeat. This field is used to schedule repeating promise payments. Ensure that "No Repeat" is selected for now, as we are scheduling a single Promise.

8. Locate the field labeled Advance overpayments. This field is used to manage repeating promise payments. Ensure that it is unchecked as we are scheduling a single promise.

9. Enter the amount of the promised payment in the field labeled Amount.

10. In the Description field, enter a description or a short note for the operator, such as, " Promise to pay."

11. If you want to assign this promise to another Operator's WIP List, select the down arrow next to the field labeled Collector to view the list of operators and make your selection.


Contact for Single Promise

12. Press F8 to save this Contact.

tip.gif If you see a prompt to "automatically manage promises," please refer to that section below.

13. The Promise Listing Summary will be displayed with the newly created promise details displayed.


Promise Listing Summary with Promise Displayed

14. Select EXIT to close the Promise Listing Summary. Then select OK to close the Debtor Financial Summary.

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Viewing The Debtor Form

When you are back at the Debtor form, select the RECALC button to refresh the account information. The Due Date of the Promise will be displayed in a field labeled Promise on the Debtor form, to the left of the OK button.


Debtor Screen with Promise Date

If the promised payment is not received by this date, the Promise field will turn RED.


Debtor Screen with Promise Date Delinquent

tip.gif To automatically refresh the financials on the Debtor form, switch ON 'Automatic recalc' for the Operator. This switch is set in the Operator form.

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Loading The WIP List

The day that this promise comes due, the Promise Contact will show up in the operator's WIP list.


WIP List With Promise Contact Loaded

If the promised payment is not received, the Promise will stay in the operator's WIP list as delinquent.

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Posting A Promise Payment

Now you can use the Promise contact to record and process Debtor payments.

tip.gif Ensure that Automatically Manage Promises is switched ON in the Payment Posting Options form.

When a payment is received, post a Payment transaction. The To Us field in the Transaction form will show the Promise Amount.


Payment Transactions with Promise Amount

After the transaction is posted, Collect! will locate the Promise contact, evaluate the payment and mark the contact as done if the promise has been met. When the promise is met and there are no other outstanding promises, the debtor's Promise field is empty. A partial or incomplete payment does not satisfy the Promise and it remains In Progress after the payment is posted.

tip.gif If there is interest to be calculated, this is calculated and added to the Owing before the promise amount is displayed.

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When An NSF Check Is Returned

When an NSF check is returned, enter the amount as a negative and Collect! will back date the promise to its outstanding date and amount.

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Multiple Single Promises

Following the same steps as outlined above, you may enter more than one promise payment. The screen shot below shows three promises scheduled for different dates and amounts.


Multiple Single Promises

The Promise field on the Debtor form will display the date of the earliest unmet promise in the contact list.

When a payment is posted, the amount of the earliest unmet promise will be automatically filled in. This contact will be marked done when the payment is posted.


One Promise Met with Two Outstanding

tip.gif Ensure that 'Automatically Manage Promises' is switched ON in the Payment Posting Options form.

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Repeating Promises

What is a repeating Promise? A repeating Promise is a Promise contact with a Repeat value and an Amount filled in. Collect! will manage this contact, evaluating it whenever a payment is posting and forwarding the Promise Due Date as necessary according to the Promise contact settings.

tip.gif The "Automatically manage promises" switch must be switched ON in Payment Posting Options for this method to work.

1. As described above, create a Promise contact for the debtor through the Debtor Financial Summary form.

2. When the new Contact form is displayed, select Promise from the Type pick list.

3. In the Due Date field, select the calendar icon to display the Calendar, and select a date for the first promised payment.

4. Enter a value in the Repeat field, such as Monthly. This creates a revolving contact.

As of version CV11.6.2.9, you now have the added cycles of First Day of the Month and Last Day of the Month as frequency periods to choose from as your Repeat cycle.

5. In the Amount field, enter the dollar amount that the Debtor has promised to pay each month

6. Locate the field labeled Advance overpayments. Switch this ON if you wish to consider overpayments as fulfillment for future promises.

7. Enter a description in the Description field. Assign the contact to a specific operator if desired.


Contact for Monthly Promise To Pay

8. Press F8 to save this Contact. The Promise Listing Summary will be displayed with the newly created promise details displayed.

tip.gif If you see a prompt to "automatically manage promises," please refer to that section below.

Select EXIT to close the Promise Listing Summary. Then select OK to close the Debtor Financial Summary.

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Viewing The Interest Detail Form

Collect! automatically stores the Payment Amount dollar value in the Interest Detail for the account.


Promise Amount Stored in Interest Detail

Collect! uses this each month to see whether or not the Promise is met. If the Promise is met, the Promise Contact Due Date will roll forward to next month, same day. If the Promise is not met, the Promise Contact Due Date does not roll forward. When the debt is completely settled, Collect! marks the Promise Contact as Done.

When a payment is partial, Collect! does not forward the promise. Instead, the remaining amount is still due on the current promise date.

When the payment is nearing completion, Collect! automatically adjusts the final payment to reflect the actual amount outstanding. The last payment turns off the promise contact cycle automatically when the Owing reaches zero.

tip.gif Ensure that 'Automatically Manage Promises' is switched ON in the Payment Posting Options form.

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Special Settings

Several settings in Collect! influence how promises are handled. These are described below.

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Automatically Manage Promises

'Automatically Manage Promises' must be switched ON in the Payment Posting Options form so that Collect! can perform automatic functions regarding promises, such as marking the Promise contact as Done, or rolling the Due Date forward, or running contact plans when a promised payment is received.

When you create your Promise, you may be alerted by Collect! if the setting 'Automatically manage promises' is not switched ON.


Prompt to Manage Promises Automatically

Please select YES when prompted so that Collect! can set this switch for you. It is necessary for managing promise payments and broken promises.


Promise Settings Updated

Select the OK button to proceed.

tip.gif You can also set this switch by selecting System from the top menu bar. Then select Preferences, Plans and Reference Tables, Payment Posting Options and put a check mark in the check box labeled Automatically Manage Promises.

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Advance Overpayments

The 'Advance Overpayments' switch on the Contact form is used to manage overpayments when a promise payment is received.


Advance Overpayments Enabled

With this switch enabled, Collect! will roll the Promise Due Date forward according to how many periods are satisfied by the payment. For example, if the debtor pays $300 at once, and that satisfies 2 monthly payments of $150, the Date Due will roll forward 2 months when this switch is enabled. If it is not enabled, the Date Due will roll forward only one month, no matter how much is overpaid.

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Max Intervals

Optionally, you can set a number of repeats for a Promise. Collect! will only repeat the Promise the number of times you set, even if this does not fully pay off the debt.

When a repeating Promise rolls forward and there is a value in the Max Intervals field, the value will be decremented. When it reaches 0, the Contact will be completed regardless of the Debtor's Owing. This enables you to accept a series of Promise payments even if this agreement does not fully pay off the debt. Without a value in the Max Intervals field, a Promise repeats until the debt reaches zero.

Max Intervals will also work with the Copy on Repeat switch, the Advance Overpayments switch, and contact plans that schedule repeating Promise contacts.

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Grace Days

If you wish to wait a few days grace before considering the Promise as overdue, open the WIP Reload Filters and enter a number of days in the 'Promise Grace Days' field.


WIP Reload Filters with Promise Grace Days

The Promise will only display in the WIP List when the grace period has expired. This means the Due Date of the promise plus the Promise Grace Days exceeds today. For instance, on April 12th, a Promise for April 8th with a 3 grace days is now overdue. On April 12th, the Promise will show up in the operator's WIP List.

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Promise Contact Actions

When a promise payment is received, it will fall into one of several categories. Either the payment satisfies the promise in full, or it is an overpayment or an underpayment. If the promise is not paid at all, this is a broken promise. If the payment is returned as NSF, it is an NSF payment.

Collect! uses settings in the Payment Posting Options form to take care of these conditions. In the Promise Contact Actions section, codes are entered for contact plans to run for Overpayment, Underpayment, Full Payment, NSF Payment and Broken Promises.


Payment Posting Options Promise Contact Actions

Each code in the Promise Contact Actions section is a contact plan set up in the database to be evaluated when Collect! handles a promise. These plans can be as simple as writing a note to the Debtor account. They can also handle very complex scenarios. An example of a complex scenario might be special letters sent to remind a debtor that the promise is due in a specific number of days, reviews scheduled based on whether or not the promise is met, special conditions for overpayment, under payment or broken promises. You also can set a contact plan to run when the Debtor's Owing reaches zero.

tip.gif If you do not want to run any contact plans, just erase the codes from each one of the Promise Contact Actions, but make sure you leave 'Automatically Manage Promises' switched ON.

These contact plans and settings are further explained in the Help topic, Promise Contact Actions. To view examples of these settings please refer to the Demonstration database.

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Payment Values

When you are viewing the Payment Posting Options form, there is an ADVANCED button that takes you to the Payment Values form. There you can enter defaults to consider when posting promised payments. You can select a Transaction Type to use for promised payments. Values may be entered for evaluating a payment as an underpayment or an overpayment, if the amount paid is not exactly the same as the promised Amount.

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Summary

A Promise is an agreement with a debtor to pay a specific sum of money on a definite date. This may be a singe payment, multiple payments or a repeating payment at regular intervals. In Collect!, the Promise Contact may be used to manage promises. Settings can be chosen to fine-tune how promise payments are handled, with special consideration given to overpayments, underpayments, broken promises and NSF payments. Once these settings are in place, Collect! will automatically track promise activity until the account is settled in full.

This process requires that the switch 'Automatically manage promises' is switched ON in the Payment Posting Options form.

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See Also

- Promise Contact Topics

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