Overview
A Short Pay allows borrowers to receive a credit for prepaid interest when closing within the first few days of the month. Instead of paying interest from the closing date through the end of the month, the system calculates a negative per diem amount that reduces their cash to close. This feature automatically becomes available in Deal Details when the closing date qualifies for the short pay window.
Before You Start
Requirement | Details |
Closing Date | Must fall within the early-month window (typically the first ~5 days) |
Key Metrics Access | Navigate to the Key Metrics section of your deal |
Saved Deal | Ensure you have an active deal open in Deal Details |
Step-by-Step: Enabling Short Pay
1. Set the Closing Date
Open your deal and navigate to Key Metrics
Enter or adjust the closing date to fall within the short pay window
2. Locate the Short Pay Toggle
Closing Date | Toggle Behavior |
Early month (e.g., 5th or earlier) | Short Pay toggle appears |
Mid-to-late month | Toggle is hidden (short pay not available) |
⚠️ Important: The Short Pay toggle only appears when the closing date qualifies. If you don't see the toggle, your closing date is outside the eligible window.
3. Enable the Short Pay Option
Toggle the Short Pay option to ON
Click Save to apply the changes
4. Name Your Scenario (Optional)
Give the scenario a descriptive name (e.g., "Short Pay") for easy reference when comparing options with your borrower
Verifying the Short Pay Credit
1. Open the Expanded Scenario View
Navigate to your saved scenario
Click to expand the full cost breakdown
2. Locate the Per Diem Interest Line
Scroll down to the prepaid interest section
Look for the Per Diem Interest line item
What You'll See | What It Means |
Negative days (e.g., "-4 days") | Number of days credited back |
Daily rate | The per diem interest amount |
Credit amount | Total reduction shown as a credit |
Finishing Up
1. Review with Your Borrower
Walk through the expanded scenario showing the per diem credit
Explain how the early closing date reduces their cash to close
2. Compare Scenarios
Create a standard scenario without short pay enabled
Use side-by-side comparison to show the savings
Quick Reference
Key Metrics → Set early-month closing date → Toggle Short Pay ON → Save → View credit in Expanded Scenario
Tips for Success
Check the calendar first—confirm your borrower can realistically close within the short pay window before presenting this option
Use scenario naming—label your short pay scenarios clearly to avoid confusion when presenting multiple options
Explain the math—borrowers appreciate understanding that the credit comes from reduced prepaid interest, not a discount on rates
Watch for date changes—if the closing date shifts outside the window, the short pay toggle disappears and the credit is removed
Related Topics
Setting the Closing Date in Key Metrics
Understanding Per Diem Interest Calculations
Comparing Loan Scenarios
Prepaid Items and Closing Costs Overview