Loan Payments

Loans payments occur in our system by pushing a transaction with the payment amount to the LOAN-US node. This can be done via internal transfers from other nodes (accounts) in our system, via incoming transactions to (credit-only) account & routing numbers issued on top of the LOAN-US node, ACH pulls, or card pulls. Subscribe to webhooks to stay in informed of when a payment is received.

The LOAN-US's negative balance--loans are expressed as a node with negative balance in our system--will be reduced by the amount of the payment and the loan will be paid fully once the balance is zero. Interest is calculated from the whole loan balance (principal + interest). For more information please look at our Loan Interest page.

Payment Due Date

One-Time Loans

If the AutoPay functionality is active ("auto_pay": true") (learn more below, funds will be automatically deducted from the inputed payment_node_id on the inputted "next_payment" date. The inputed number is not a calendar day but rather the days until AutoPay will deduct from the payment node. Subsequent AutoPayments will occur on that same calendar day moving forward. If an AutoPayment is set for the 29th, 30th, or 31st of the month, we have set logic to ensure it will fall on the last day of shorter months (e.g. February).

Example:
If the node is created on the 5th of that month and "next_payment": 15 funds will be automatically deducted 15 days later (the 20th, assuming "schedule":"MONTHLY"). You can look at the time and amounts of all installments by looking at the installments array of objects at the point of creation or with our View Loan Details API call.

If AutoPay is not active, there will be no defined payment dates for the one-time loan from Synapse. You will be able to make loan payments at any point and interest will continue to accrue and compound daily until the cap amount is reached. If AutoPay is enabled you will still be able to create additional loan payments at any time (learn more below).

Revolving Loans

Assuming "schedule":"MONTHLY" users from revolving loans will have at least a 21-day grace period after their monthly statement is delivered to make a payment for the loan without the accrual of interest for the transactions from that cycle. Under normal conditions, this will be on the last day of the subsequent month.

Users can decide not to pay and interest will accrue. Users also have the ability to pay earlier (or at any point). For more details on how interest works please refer to our Loan Interest page.

Loan Payment Functionalities

We offer some further functionalities to improve loan servicing:

AutoPay

Only for One-Time Loans
AutoPay automatically deducts from an inputted payment_node_id loan payments (ex, ACH-US). The date at which AutoPay will deduct will be defined by the next_payment parameter (set to number of days until next payment); AutoPay will not be activated if a payment_node_id is not provided (this parameter is also used to toggle AutoPay on and off). You can look within the installments array of objects to view the precise moments when AutoPay will be initiated.

AutoPay Payment Amount

AutoPay will debit from the payment node the sum of the principal plus the cap amount, divided by the number of installments.

For example, if a loan has $1000 principal, a Cap Amount of 40% ($400), and 10 installments (payments), AutoPay will debit for each period $140 ((1000+400)/10).

Given that the cap amount is higher than the APR, the user will be paying the loan more quickly than if he or she was paying the amortized principal and interest. Assuming all payments are successful, AutoPay will potentially pay the loan in fewer installments than defined at loan creation. If the amount remaining in the loan balance is smaller than the AutoPay Payment amount, AutoPay will only debit from the payment node the remaining balance. Once the loan balance is 0, AutoPay will deactivate itself.

Handling Additional User Payments

To make a loan payment ahead of schedule for any reason, you can at any point create a transaction to the LOAN-US node.

If you do not want AutoPay to debit the payment node that cycle (e.g. AutoPay was set for the 15th of the month, but the user made an early payment on the 10th), you will need to use the Change Payment Date API call to shift the payment date to the next month.

By default, the dates of all upcoming installments will be moved by the inputted amount (next_payment). Whatever calendar date the next payment falls on will be the day of the month that all subsequent payments will fall on. If you wish to update the schedule of only the upcoming installment, include "update_schedule": false within the Change Payment Date payload. For more information refer to Snooze Payment below.

Snooze Payment

We offer the ability for a user to delay (or “snooze”) a loan's payment date and consequently shift all following payments dates (to the same day of the month for subsequent months) via the Change Payment Date.

Please note that daily interest will still accrue for a loan when its payment date is changed, and a platform should make this distinction clear to users. Learn more about interest here.