A payment factor loan is a custom loan type where monthly payments are defined as a percentage of the original loan principal for each period — rather than being calculated by Aurora from an interest rate and term. Use this loan type when your financing partner provides a fixed payment schedule that can’t be reproduced using a standard amortization formula.
Payment factor loans are used to model any financing product that doesn't conform to a standard payment schedule — including loans where interest accrues over a partial month, and any loan where the partner provides a payment factor structure rather than an interest rate and duration. Propel (via Concert) is a common example.
In this article, we’ll cover:
- How payment factor loans work
- How to create a payment factor loan
- How periods work
- How payment factor loans appear in Sales Mode
How payment factor loans work
In a payment factor loan, you define one or more periods. Each period has a duration (in months) and a payment factor (as a percentage of the original principal). Aurora multiplies that percentage by the principal to calculate the homeowner’s dollar payment for that period.
For example:
- A $30,000 loan with a payment factor of 0.35% produces a monthly payment of $105 for that period.
Unlike other loan types, Aurora does not derive payments from a standard interest rate formula. The payment factor you enter is the source of truth for the payment amount. An interest rate field is still available and is used for display purposes only — it does not affect the calculated payment.
How to create a payment factor loan
- Go to Database in the left navigation menu.
- Select Financing products.
- Click Add financing product in the upper-right corner.
- Enter a Name, select a Project type (Residential or Commercial), and choose Loan as the financing type.
- Click Add.
- Click Add loan.
- Set Loan type to Payment factor.
- Configure the following fields:
Shared loan fields
- Name — The label that appears in Sales Mode. Include the partner name and key terms (e.g., “Concert 25yr”) so reps can identify it at a glance.
- Assign to — Controls which partners can see and use this loan. Defaults to All partners.
- Principal — Percentage of the system cost financed. Typically 100%.
- Flat fee — Optional fixed dollar amount added to the loan principal on top of any dealer fee.
- Dealer fee — Your partner’s fee as a percentage of the financed cost. See Loan Dealer Fee for how this affects the principal.
- Incentives apply to dealer fee — Enable if incentives should be calculated on the dealer-fee-inclusive system cost.
Payment factor-specific fields
- Interest rate — For display only. Aurora shows this rate on the proposal and in the financing summary, but it does not affect the calculated monthly payment.
- Duration — Auto-calculated based on the total months across all periods you define. This field is read-only.
9. Add your payment factor periods (see How periods work below).
10. Click Save.
How periods work
Payment factor loans are structured as one or more periods. Each period defines:
- Duration — The number of months this period lasts.
- Payment factor — The monthly payment as a percentage of the original loan principal.
You can add as many periods as your financing partner’s rate structure requires. Click + Add period to add additional periods.
Example: A 25-year loan with three payment periods might look like this:
- Period 1: 12 months at 3.5% → $350/month on a $10,000 principal
- Period 2: 24 months at 6.5% → $650/month
- Period 3: 264 months at 7.25% → $725/month
Aurora calculates the dollar amounts automatically based on the principal and the payment factor you enter. The total duration field updates automatically to reflect the sum of all periods.
Note: Payment factor loans are intended for use when your financing partner provides the exact payment schedule. The payment amounts shown in Aurora will only match your partner’s quoted amounts if your partner’s payment factors are based on the same principal. Small discrepancies may occur if prepayments, interest re-amortization, or half-month interest accrual are involved. Consult your partner’s documentation for exact factor values to use.
How payment factor loans appear in Sales Mode
Once saved, your payment factor loan appears in Sales Mode on the Financing tab alongside your other financing products. Reps select it like any other loan.
The homeowner’s monthly payment is calculated from the period structure you defined. In proposals and financial summaries, Aurora displays:
- The monthly payment amount for the current period
- The interest rate (for display purposes)
- The total loan term (auto-derived from all periods combined)
Because payments are period-defined rather than formula-derived, the payment amount is fixed per period and does not change based on system size or price changes beyond what’s reflected in the principal.
Note: The downloadable financial Excel model does not split out principal and interest payments for payment factor loans. This is expected behavior — because payments are defined by a payment factor rather than derived from an amortization schedule, Aurora does not have the data to separate principal and interest components.