Write-off

Operational Use Cases

• Final closure of unrecoverable loans: After all recovery avenues are exhausted, write off the balance and close the loan.
• Compliance-driven clean-up: Regulators may require loans to be written off after a set period even if charge-off already occurred.

Applies to both Fixed and Dynamic repayment schedule engines. Interest recalculation (if enabled) ensures outstanding amounts and accruals are correct before closure.

Lifecycle Snapshot

flowchart LR
    A[Confirm write-off approval] --> B[POST /transactions?command=writeoff]
    B --> C[Loan status = WRITTEN_OFF & CLOSED]
    C --> D[Accruals reversed and GL entries posted]
    D --> E[Optional recoveries via recoverypayment command]

API Playbook

1. Execute write-off

   HTTP

   POST /v1/loans/{loanId}/transactions?command=writeoff
   {
     "locale": "en",
     "dateFormat": "dd MMM yyyy",
     "transactionDate": "15 Sep 2025",
     "writeoffReasonId": 6,
     "note": "Debt sold to XYZ Agency",
     "externalId": "WO-2025-09-15-XYZ"
   }

   Validations:

   • Loan must be Active or charged-off (depending on product configuration).
   • transactionDate cannot be in the future, and no later user transactions may exist.

2. Post-write-off handling

   • Loan status moves to WRITTEN_OFF. Embarc stops accruals and closes the account.
   • Use POST /transactions?command=recoverypayment for any amounts recovered after write-off; these are tracked separately.

Tips for Operations Teams

• Capture the write-off reason and external reference (e.g., debt sale contract) in the note for audit trails.
• Writing off an account cannot be undone; if a reversal is absolutely needed, coordinate with technical support to reverse the transaction and re-open the loan.