negativeRateOption - Minimum/Maximum Rates

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Updated June 25, 2020 08:55.

The minimum/maximum rates in Fairways Debt enable you to define an interest rate range for floating rates.

<standardLoan>
 <phases>
  <phase>
   <indexing>
    <index>
     <advanced>
      <interestRateComputation>
       <negativeRateOption>MIN_MAX</negativeRateOption>
       <minBoundRate> ... </minBoundRate>
       <maxBoundRate> ... </maxBoundRate>
      </interestRateComputation>
     </advanced>
    </index>
   </indexing>
  </phase>
 </phases>
</standardLoan>

Tag	Item	Description
negativeRateOption	Mandatory	Rules to apply to floating rates.
minBoundRate	Optional	Minimum rate: floating rates lower than the minimum rate are set to the minimum rate.
maxBoundRate	Optional	Maximum rate: floating rates higher than the maximum rate are set to the maximum rate.

To apply a minimum and/or a maximum rate to a transaction:

Add the <negativeRateOption> tags with the MIN_MAX value in the <interestRateComputation> tags of the transaction.

<standardLoan>
 <phases>
  <phase>
   <indexing>
    <index>
     <advanced>
      <interestRateComputation>
       <negativeRateOption>MIN_MAX</negativeRateOption>
      </interestRateComputation>
     </advanced>
    </index>
   </indexing>
  </phase>
 </phases>
</standardLoan>

Add both or either these tags in the <interestRateComputation> tags of the transaction:
- <minBoundRate>
- <maxBoundRate>

<standardLoan>
 <phases>
  <phase>
   <indexing>
    <index>
     <advanced>
      <interestRateComputation>
       <negativeRateOption>MIN_MAX</negativeRateOption>
       <minBoundRate></minBoundRate>
       <maxBoundRate></maxBoundRate>
      </interestRateComputation>
     </advanced>
    </index>
   </indexing>
  </phase>
 </phases>
</standardLoan>

Enter the minimum and/or the maximum rate(s).

Note: The maximum rate must be higher than the minimum rate.

In this example, we enter:

A minimum rate of 0.50
A maximum rate of 0.60

<standardLoan>
 <phases>
  <phase>
   <indexing>
    <index>
     <advanced>
      <interestRateComputation>
       <negativeRateOption>MIN_MAX</negativeRateOption>
       <minBoundRate>0.50</minBoundRate>
       <maxBoundRate>0.60</maxBoundRate>
      </interestRateComputation>
     </advanced>
    </index>
   </indexing>
  </phase>
 </phases>
</standardLoan>

The rates display in the Indexation panel and apply to the transaction schedule.

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