# Issue and manage credits

A service credit reduces a loan balance similarly to a payment. Use **Issue credit** to apply a credit to the loan — for example, to compensate for a billing error, adjust interest, or settle a debt. Use **Manage credits** to backdate a credit to a different effective date or cancel a credit that was issued by mistake.

**Availability:** All clients
**Required permissions:** `transaction:create.servicecredit` (to issue); `transaction:backdate` AND `transaction:reverse` (both required to manage)
**Loan status:** Issue requires `active`, `accelerated`, or `chargedOff`; Manage requires `active`, `paidOff`, `accelerated`, or `chargedOff`
**Loan types:** All

## Before you begin

- The credit waterfall may differ from the payment waterfall. Your company can configure credits to apply to accrued interest and fees but not principal, or to follow a custom allocation order.
- A service credit with a future effective date is applied on that date. A credit cannot be directly applied to a past date — to backdate a credit, issue it with today's date and then use the Manage Credits tool to change the effective date.
- For Line of Credit loans, you can target a credit to a specific draw or let it allocate across all draws automatically.


## Issue a credit

1. From the agent-view Borrower Portal, open the loan and select **Loan options** > **Issue credit**.
2. Enter the credit **Amount**. The maximum amount is displayed on the form.
3. Select the **Responsible party** — the party that is financially responsible for the credit. This affects the lender's accounting but does not change how the credit is applied to the borrower's loan.
4. Select the **Service credit type** from the dropdown.
5. Optionally enter a **Custom display name** to override the default display name in the borrower's Activity view.
6. Select an **Effective date**. By default this is set to today. Selecting a future date schedules the credit. Selecting a past date triggers an account replay.
7. For Line of Credit loans, select the scope from the **Applicable to** dropdown. See [Global behaviors — Applicable-to selector](/servicing-operations/agent-only-tools/agent-tools-overview#applicable-to-selector).
8. If your company requires a Case ID, select a case from the **Case ID** dropdown. See [Global behaviors — Case ID requirement](/servicing-operations/agent-only-tools/agent-tools-overview#case-id-requirement).
9. Select **Issue credit**.


The credit is applied to the loan. The credit appears in the borrower's Activity view.

### Issue credit field reference

| Field | Description | Required | Values / Format |
|  --- | --- | --- | --- |
| **Amount** | The credit amount. Cannot exceed the maximum amount displayed on the form. | Yes | Currency |
| **Responsible party** | The party financially responsible for the credit. Does not affect how the credit is applied to the loan. | Yes | Select: Lender, Servicer, Merchant |
| **Service credit type** | The category of the credit. | Yes | Select: Bad Debt, Bankruptcy, Deceased, Fraud, Usury cap, Rewards, Service credit - agent, Service credit - supervisor, Settlement of debt |
| **Custom display name** | An optional name that overrides the default display in the borrower's Activity view. | No | Text |
| **Effective date** | The date the credit takes effect. Future dates schedule the credit. Past dates trigger a replay. | Yes | Date (default: today) |
| **Applicable to** | Whether to apply the credit to the full line of credit or a specific draw. Only shown for LOC loans. | Conditional | Select: Line of credit and draws, or a specific draw |
| **Case ID** | The case associated with this action. | Conditional | Select from open cases. Required when `forceCaseIdOnAgentActions` is enabled. |


## Manage credits

View all credits on the loan and take action on individual credits — cancel a credit to reverse its effect, or backdate a credit to a different effective date.

1. From the agent-view Borrower Portal, open the loan and select **Loan options** > **Manage credits**.
2. The credit list displays all credits sorted from newest to oldest. Each row shows the effective date, status, responsible party, and amount.
3. Select a credit row to expand it and view details including the unique transaction ID.


### Cancel a credit

Canceling a credit creates a reversal transaction that offsets the original credit. The loan balance increases as if the credit was never issued. Credits can only be canceled in full.

1. From the credit list, select a credit in **Succeeded** status.
2. Select **Cancel**.
3. If your company requires a Case ID, select a case from the **Case ID** dropdown.
4. Confirm the cancellation.


The system automatically determines whether to use a cancel or reverse operation based on the transaction state. In both cases, the result is the same — the credit is fully offset.

**Eligible credits:** Status is `succeeded`, credit has not already been reversed, and credit reason is not `reversal`. Loan status must be `active`, `accelerated`, or `chargedOff`.

### Backdate a credit

Backdating changes the effective date and time of a credit. The system replays the loan from the new date.

1. From the credit list, select a credit in **Succeeded** or **Pending** status.
2. Select **Backdate**.
3. Select a new **Effective date and time**. The date must be between the loan start date and today.
4. If your company requires a Case ID, select a case from the **Case ID** dropdown.
5. Confirm the backdate.


**Eligible credits:** Status is `succeeded` or `pending`, credit has not already been reversed, and credit reason is not `reversal`. Loan status must be `active`, `accelerated`, or `chargedOff`.

### Manage credits field reference

| Field | Description | Required | Values / Format |
|  --- | --- | --- | --- |
| **Credit selection** | The credit to act on. Select a row from the credit list. | Yes | Credit list (only `succeeded` or `pending` credits are actionable) |
| **Effective date and time** | The new effective date and time (backdate action only). | Yes | Datetime (range: loan start date to today) |
| **Case ID** | The case associated with this action. | Conditional | Select from open cases. Required when `forceCaseIdOnAgentActions` is enabled. |


## Related pages

- [Agent-only loan tools](/servicing-operations/agent-only-tools/agent-tools-overview)
- [Manage payments](/servicing-operations/agent-only-tools/agent-tools-manage-payments)
- [Apply external payments](/servicing-operations/agent-only-tools/agent-tools-external-payments)