diff --git a/mifosng-provider/src/main/java/org/mifosplatform/portfolio/loanaccount/domain/Loan.java b/mifosng-provider/src/main/java/org/mifosplatform/portfolio/loanaccount/domain/Loan.java
index a3cc27768..bbe6d62ff 100755
--- a/mifosng-provider/src/main/java/org/mifosplatform/portfolio/loanaccount/domain/Loan.java
+++ b/mifosng-provider/src/main/java/org/mifosplatform/portfolio/loanaccount/domain/Loan.java
@@ -3851,4 +3851,7 @@ public class Loan extends AbstractPersistable<Long> {
         return this.approvedPrincipal;
     }
 
+    public BigDecimal getTotalOverpaid() {
+        return this.totalOverpaid;
+    }
 }
\ No newline at end of file
diff --git a/mifosng-provider/src/main/java/org/mifosplatform/portfolio/loanaccount/service/LoanWritePlatformServiceJpaRepositoryImpl.java b/mifosng-provider/src/main/java/org/mifosplatform/portfolio/loanaccount/service/LoanWritePlatformServiceJpaRepositoryImpl.java
index 3366c5fca..6d4106a3f 100755
--- a/mifosng-provider/src/main/java/org/mifosplatform/portfolio/loanaccount/service/LoanWritePlatformServiceJpaRepositoryImpl.java
+++ b/mifosng-provider/src/main/java/org/mifosplatform/portfolio/loanaccount/service/LoanWritePlatformServiceJpaRepositoryImpl.java
@@ -1407,7 +1407,11 @@ public class LoanWritePlatformServiceJpaRepositoryImpl implements LoanWritePlatf
 
         final LoanTransaction newTransferAcceptanceTransaction = LoanTransaction.approveTransfer(acceptedInOffice, loan, transferDate);
         loan.getLoanTransactions().add(newTransferAcceptanceTransaction);
-        loan.setLoanStatus(LoanStatus.ACTIVE.getValue());
+        if(loan.getTotalOverpaid() !=null){
+            loan.setLoanStatus(LoanStatus.OVERPAID.getValue());
+        }else{
+            loan.setLoanStatus(LoanStatus.ACTIVE.getValue());
+        }
         if (loanOfficer != null) {
             loan.reassignLoanOfficer(loanOfficer, transferDate);
         }