Repayment Structures

AFQS supports regular, irregular and seasonal repayment options.

Regular Repayments

Regular is the most common repayment option. The pattern of the repayments (rentals for lease and instalments for hire purchase or equipment loan) is determined by the start date and the frequency (monthly, quarterly, half-yearly and yearly).

If the repayment start date coincides with the quote commencement date, the repayments are made in advance. A start date deferred by one frequency unit indicates that the repayments are in arrears.

This simple scenario may result in the following repayments calculation.

Irregular Repayments

The irregular repayment option is used to split the repayments into segments with different amounts and/or frequency. In the example below, there are 12 monthly fixed repayments of $1,500. The repayments for the remainder of the term will be calculated.

The resulting calculation has one fixed segment followed by 36 repayments of $1,702.67.

When solving for repayment, at least one of the repayment segments must not be fixed.

In addition to fixed amounts, it is possible to specify repayment ratios. For example, if there are two segments with the ratios 1 and 1.05, this means that the calculated repayment amount of the second segment has to be 5% higher than the first segment.

Irregular repayments are often used to specify rental holidays. For example, 12 monthly repayments starting from February 2022, then 30 monthly repayments starting from August 2023, with no repayments from February 2023 to July 2023.

Irregular repayment segments must not overlap.

Seasonal Repayments

The seasonal repayment option can be used to specify a repayment pattern repeated for every year of the quote term. In the example below, there is a repayment in every month of the year except for November and December.

The same repayment structure can be specified through the irregular repayment option. However, the seasonal option is more convenient when there is an annual pattern.

Seasonal repayments have a more segmented structure and are typical of agricultural equipment finance.