FINERACT-2311: Buy down fee - final amortization

- early repayment
- write off
- charge-off

fineract-e2e-tests-runner/src/test/resources/features/LoanBuyDownFees.feature

@@ -327,12 +327,17 @@ Feature:Feature: Buy Down Fees
     When Loan Pay-off is made on "1 March 2024"
     Then Loan's all installments have obligations met
     Then Loan Transactions tab has the following data:
-      | Transaction date | Transaction Type | Amount | Principal | Interest | Fees | Penalties | Loan Balance | Reverted |
+      | Transaction date | Transaction Type          | Amount | Principal | Interest | Fees | Penalties | Loan Balance | Reverted |
-      | 01 January 2024  | Disbursement     | 100.0  | 0.0       | 0.0      | 0.0  | 0.0       | 100.0        | false    |
+      | 01 January 2024  | Disbursement              | 100.0  | 0.0       | 0.0      | 0.0  | 0.0       | 100.0        | false    |
-      | 01 January 2024  | Buy Down Fee     | 50.0   | 0.0       | 0.0      | 0.0  | 0.0       | 100.0        | false    |
+      | 01 January 2024  | Buy Down Fee              | 50.0   | 0.0       | 0.0      | 0.0  | 0.0       | 100.0        | false    |
-      | 01 February 2024 | Repayment        | 33.72  | 33.14     | 0.58     | 0.0  | 0.0       | 66.86        | false    |
+      | 01 February 2024 | Repayment                 | 33.72  | 33.14     | 0.58     | 0.0  | 0.0       | 66.86        | false    |
-      | 01 March 2024    | Repayment        | 67.25  | 66.86     | 0.39     | 0.0  | 0.0       | 0.0          | false    |
+      | 01 March 2024    | Repayment                 | 67.25  | 66.86     | 0.39     | 0.0  | 0.0       | 0.0          | false    |
-      | 01 March 2024    | Accrual          | 0.97   | 0.0       | 0.97     | 0.0  | 0.0       | 0.0          | false    |
+      | 01 March 2024    | Accrual                   | 0.97   | 0.0       | 0.97     | 0.0  | 0.0       | 0.0          | false    |
+      | 01 March 2024    | Buy Down Fee Amortization | 50.0   | 0.0       | 50.0     | 0.0  | 0.0       | 0.0          | false    |
+    And Loan Transactions tab has a "BUY_DOWN_FEE_AMORTIZATION" transaction with date "01 March 2024" which has the following Journal entries:
+      | Type      | Account code | Account name                | Debit | Credit |
+      | INCOME    | 450281       | Income From Buy Down        |       | 50.0   |
+      | LIABILITY | 145024       | Deferred Capitalized Income | 50.0  |        |
 
   @TestRailId:C3828
   Scenario: Verify loan with Buy Down fees and early payoff and daily amortization - UC2.2
@@ -508,6 +513,11 @@ Feature:Feature: Buy Down Fees
 
       | 01 March 2024    | Repayment                 | 67.25  | 66.86     | 0.39     | 0.0  | 0.0       | 0.0          | false    |
       | 01 March 2024    | Accrual                   | 0.01   | 0.0       | 0.01     | 0.0  | 0.0       | 0.0          | false    |
+      | 01 March 2024    | Buy Down Fee Amortization | 17.03  | 0.0       | 17.03    | 0.0  | 0.0       | 0.0          | false    |
+    And Loan Transactions tab has a "BUY_DOWN_FEE_AMORTIZATION" transaction with date "01 March 2024" which has the following Journal entries:
+      | Type      | Account code | Account name                | Debit | Credit |
+      | INCOME    | 450281       | Income From Buy Down        |       | 17.03  |
+      | LIABILITY | 145024       | Deferred Capitalized Income | 17.03 |        |
 
   @TestRailId:C3772
   Scenario: Verify loan with Buy Down fees and charge-off - UC3.1
@@ -556,12 +566,18 @@ Feature:Feature: Buy Down Fees
       | EXPENSE   | 744007       | Credit Loss/Bad Debt       |  66.86 |        |
       | INCOME    | 404001       | Interest Income Charge Off |   0.59 |        |
     Then Loan Transactions tab has the following data:
-      | Transaction date | Transaction Type | Amount | Principal | Interest | Fees | Penalties | Loan Balance | Reverted |
+      | Transaction date | Transaction Type          | Amount | Principal | Interest | Fees | Penalties | Loan Balance | Reverted |
-      | 01 January 2024  | Disbursement     | 100.0  | 0.0       | 0.0      | 0.0  | 0.0       | 100.0        | false    |
+      | 01 January 2024  | Disbursement              | 100.0  | 0.0       | 0.0      | 0.0  | 0.0       | 100.0        | false    |
-      | 01 January 2024  | Buy Down Fee     | 50.0   | 0.0       | 0.0      | 0.0  | 0.0       | 100.0        | false    |
+      | 01 January 2024  | Buy Down Fee              | 50.0   | 0.0       | 0.0      | 0.0  | 0.0       | 100.0        | false    |
-      | 01 February 2024 | Repayment        | 33.72  | 33.14     | 0.58     | 0.0  | 0.0       | 66.86        | false    |
+      | 01 February 2024 | Repayment                 | 33.72  | 33.14     | 0.58     | 0.0  | 0.0       | 66.86        | false    |
-      | 01 March 2024    | Accrual          | 0.97   | 0.0       | 0.97     | 0.0  | 0.0       | 0.0          | false    |
+      | 01 March 2024    | Buy Down Fee Amortization | 33.52  | 0.0       | 33.52    | 0.0  | 0.0       | 0.0          | false    |
-      | 01 March 2024    | Charge-off       | 67.45  | 66.86     | 0.59     | 0.0  | 0.0       | 0.0          | false    |
+      | 01 March 2024    | Accrual                   | 0.97   | 0.0       | 0.97     | 0.0  | 0.0       | 0.0          | false    |
+      | 01 March 2024    | Charge-off                | 67.45  | 66.86     | 0.59     | 0.0  | 0.0       | 0.0          | false    |
+      | 01 March 2024    | Buy Down Fee Amortization | 16.48  | 0.0       | 16.48    | 0.0  | 0.0       | 0.0          | false    |
+    And Loan Transactions tab has a "BUY_DOWN_FEE_AMORTIZATION" transaction with date "01 March 2024" which has the following Journal entries:
+      | Type      | Account code | Account name                | Debit | Credit |
+      | EXPENSE   | 744007       | Credit Loss/Bad Debt        |       | 16.48  |
+      | LIABILITY | 145024       | Deferred Capitalized Income | 16.48 |        |
 
     When Loan Pay-off is made on "1 March 2024"
     Then Loan's all installments have obligations met
@@ -745,8 +761,14 @@ Feature:Feature: Buy Down Fees
       | 29 February 2024 | Accrual                   | 0.02   | 0.0       | 0.02     | 0.0  | 0.0       | 0.0          | false    |
       | 29 February 2024 | Buy Down Fee Amortization | 0.55   | 0.0       | 0.55     | 0.0  | 0.0       | 0.0          | false    |
 
+      | 01 March 2024    | Buy Down Fee Amortization | 0.55   | 0.0       | 0.55     | 0.0  | 0.0       | 0.0          | false    |
       | 01 March 2024    | Accrual                   | 0.01   | 0.0       | 0.01     | 0.0  | 0.0       | 0.0          | false    |
       | 01 March 2024    | Charge-off                | 67.45  | 66.86     | 0.59     | 0.0  | 0.0       | 0.0          | false    |
+      | 01 March 2024    | Buy Down Fee Amortization | 16.48  | 0.0       | 16.48    | 0.0  | 0.0       | 0.0          | false    |
+    And Loan Transactions tab has a "BUY_DOWN_FEE_AMORTIZATION" transaction with date "01 March 2024" which has the following Journal entries:
+      | Type      | Account code | Account name                | Debit | Credit |
+      | EXPENSE   | 744007       | Credit Loss/Bad Debt        |       | 16.48  |
+      | LIABILITY | 145024       | Deferred Capitalized Income | 16.48 |        |
 
     When Loan Pay-off is made on "1 March 2024"
     Then Loan's all installments have obligations met

fineract-loan/src/main/java/org/apache/fineract/portfolio/loanaccount/domain/Loan.java

@@ -1755,8 +1755,9 @@ public class Loan extends AbstractAuditableWithUTCDateTimeCustom<Long> {
 
     public LoanTransaction getLastUserTransaction() {
         return getLoanTransactions().stream() //
-                .filter(t -> t.isNotReversed()
+                .filter(t -> t.isNotReversed() && !(t.isAccrual() || t.isAccrualAdjustment() || t.isIncomePosting()
-                        && !(t.isAccrual() || t.isAccrualAdjustment() || t.isIncomePosting() || t.isCapitalizedIncomeAmortization())) //
+                        || t.isCapitalizedIncomeAmortization() || t.isCapitalizedIncomeAmortizationAdjustment()
+                        || t.isBuyDownFeeAmortization() || t.isBuyDownFeeAmortizationAdjustment())) //
                 .reduce((first, second) -> second) //
                 .orElse(null);
     }

fineract-loan/src/main/java/org/apache/fineract/portfolio/loanaccount/domain/LoanTransaction.java

@@ -706,6 +706,10 @@ public class LoanTransaction extends AbstractAuditableWithUTCDateTimeCustom<Long
         return LoanTransactionType.CAPITALIZED_INCOME_AMORTIZATION.equals(getTypeOf()) && isNotReversed();
     }
 
+    public boolean isCapitalizedIncomeAmortizationAdjustment() {
+        return LoanTransactionType.CAPITALIZED_INCOME_AMORTIZATION_ADJUSTMENT.equals(getTypeOf()) && isNotReversed();
+    }
+
     public boolean isCapitalizedIncomeAdjustment() {
         return LoanTransactionType.CAPITALIZED_INCOME_ADJUSTMENT.equals(getTypeOf()) && isNotReversed();
     }
@@ -998,4 +1002,16 @@ public class LoanTransaction extends AbstractAuditableWithUTCDateTimeCustom<Long
     public boolean isBuyDownFee() {
         return LoanTransactionType.BUY_DOWN_FEE.equals(this.typeOf);
     }
+
+    public boolean isBuyDownFeeAdjustment() {
+        return LoanTransactionType.BUY_DOWN_FEE_ADJUSTMENT.equals(this.typeOf);
+    }
+
+    public boolean isBuyDownFeeAmortization() {
+        return LoanTransactionType.BUY_DOWN_FEE_AMORTIZATION.equals(this.typeOf);
+    }
+
+    public boolean isBuyDownFeeAmortizationAdjustment() {
+        return LoanTransactionType.BUY_DOWN_FEE_AMORTIZATION_ADJUSTMENT.equals(this.typeOf);
+    }
 }

fineract-loan/src/main/java/org/apache/fineract/portfolio/loanaccount/service/LoanBuyDownFeeAmortizationProcessingService.java

@@ -20,9 +20,16 @@ package org.apache.fineract.portfolio.loanaccount.service;
 
 import java.time.LocalDate;
 import org.apache.fineract.portfolio.loanaccount.domain.Loan;
+import org.apache.fineract.portfolio.loanaccount.domain.LoanTransaction;
 import org.springframework.lang.NonNull;
 
 public interface LoanBuyDownFeeAmortizationProcessingService {
 
     void processBuyDownFeeAmortizationTillDate(@NonNull Loan loan, @NonNull LocalDate tillDate, boolean addJournal);
+
+    void processBuyDownFeeAmortizationOnLoanClosure(@NonNull Loan loan, boolean addJournal);
+
+    void processBuyDownFeeAmortizationOnLoanChargeOff(@NonNull Loan loan, @NonNull LoanTransaction chargeOffTransaction);
+
+    void processBuyDownFeeAmortizationOnLoanUndoChargeOff(@NonNull LoanTransaction loanTransaction);
 }

fineract-provider/src/main/java/org/apache/fineract/portfolio/loanaccount/service/LoanBuyDownFeeAmortizationEventService.java

@@ -0,0 +1,121 @@
+/**
+ * Licensed to the Apache Software Foundation (ASF) under one
+ * or more contributor license agreements. See the NOTICE file
+ * distributed with this work for additional information
+ * regarding copyright ownership. The ASF licenses this file
+ * to you under the Apache License, Version 2.0 (the
+ * "License"); you may not use this file except in compliance
+ * with the License. You may obtain a copy of the License at
+ *
+ * http://www.apache.org/licenses/LICENSE-2.0
+ *
+ * Unless required by applicable law or agreed to in writing,
+ * software distributed under the License is distributed on an
+ * "AS IS" BASIS, WITHOUT WARRANTIES OR CONDITIONS OF ANY
+ * KIND, either express or implied. See the License for the
+ * specific language governing permissions and limitations
+ * under the License.
+ */
+package org.apache.fineract.portfolio.loanaccount.service;
+
+import jakarta.annotation.PostConstruct;
+import lombok.RequiredArgsConstructor;
+import lombok.extern.slf4j.Slf4j;
+import org.apache.fineract.infrastructure.core.service.DateUtils;
+import org.apache.fineract.infrastructure.event.business.BusinessEventListener;
+import org.apache.fineract.infrastructure.event.business.domain.loan.LoanBalanceChangedBusinessEvent;
+import org.apache.fineract.infrastructure.event.business.domain.loan.LoanCloseBusinessEvent;
+import org.apache.fineract.infrastructure.event.business.domain.loan.transaction.LoanChargeOffPostBusinessEvent;
+import org.apache.fineract.infrastructure.event.business.domain.loan.transaction.LoanChargeOffPreBusinessEvent;
+import org.apache.fineract.infrastructure.event.business.domain.loan.transaction.LoanUndoChargeOffBusinessEvent;
+import org.apache.fineract.infrastructure.event.business.service.BusinessEventNotifierService;
+import org.apache.fineract.portfolio.loanaccount.domain.Loan;
+import org.apache.fineract.portfolio.loanaccount.domain.LoanStatus;
+import org.apache.fineract.portfolio.loanaccount.domain.LoanTransaction;
+
+@Slf4j
+@RequiredArgsConstructor
+public class LoanBuyDownFeeAmortizationEventService {
+
+    private final BusinessEventNotifierService businessEventNotifierService;
+    private final LoanBuyDownFeeAmortizationProcessingService loanBuyDownFeeAmortizationProcessingService;
+
+    @PostConstruct
+    public void addListeners() {
+        businessEventNotifierService.addPreBusinessEventListener(LoanCloseBusinessEvent.class, new LoanCloseListener());
+        businessEventNotifierService.addPostBusinessEventListener(LoanBalanceChangedBusinessEvent.class, new LoanBalanceChangedListener());
+        businessEventNotifierService.addPostBusinessEventListener(LoanChargeOffPostBusinessEvent.class, new LoanChargeOffEventListener());
+        businessEventNotifierService.addPostBusinessEventListener(LoanUndoChargeOffBusinessEvent.class,
+                new LoanUndoChargeOffEventListener());
+        businessEventNotifierService.addPreBusinessEventListener(LoanChargeOffPreBusinessEvent.class, new LoanChargeOffPreEventListener());
+    }
+
+    private final class LoanCloseListener implements BusinessEventListener<LoanCloseBusinessEvent> {
+
+        @Override
+        public void onBusinessEvent(final LoanCloseBusinessEvent event) {
+            final Loan loan = event.get();
+            final LoanStatus status = loan.getStatus();
+            if (loan.getLoanProductRelatedDetail().isEnableBuyDownFee()
+                    && (status.isClosedObligationsMet() || status.isClosedWrittenOff() || status.isOverpaid())) {
+                log.debug("Loan closure on buy down fee amortization for loan {}", loan.getId());
+                loanBuyDownFeeAmortizationProcessingService.processBuyDownFeeAmortizationOnLoanClosure(loan, false);
+            }
+        }
+    }
+
+    private final class LoanBalanceChangedListener implements BusinessEventListener<LoanBalanceChangedBusinessEvent> {
+
+        @Override
+        public void onBusinessEvent(final LoanBalanceChangedBusinessEvent event) {
+            final Loan loan = event.get();
+            final LoanStatus status = loan.getStatus();
+            if (loan.getLoanProductRelatedDetail().isEnableBuyDownFee()
+                    && (status.isClosedObligationsMet() || status.isClosedWrittenOff() || status.isOverpaid())) {
+                log.debug("Loan balance change on buy down fee amortization for loan {}", loan.getId());
+                loanBuyDownFeeAmortizationProcessingService.processBuyDownFeeAmortizationOnLoanClosure(loan, true);
+            }
+        }
+    }
+
+    private final class LoanChargeOffEventListener implements BusinessEventListener<LoanChargeOffPostBusinessEvent> {
+
+        @Override
+        public void onBusinessEvent(final LoanChargeOffPostBusinessEvent event) {
+            final LoanTransaction loanTransaction = event.get();
+            final Loan loan = loanTransaction.getLoan();
+            if (loan.getLoanProductRelatedDetail().isEnableBuyDownFee() && loan.isChargedOff() && loanTransaction.isChargeOff()) {
+                log.debug("Loan charge-off on buy down fee amortization for loan {}", loan.getId());
+                loanBuyDownFeeAmortizationProcessingService.processBuyDownFeeAmortizationOnLoanChargeOff(loan, loanTransaction);
+            }
+        }
+    }
+
+    private final class LoanChargeOffPreEventListener implements BusinessEventListener<LoanChargeOffPreBusinessEvent> {
+
+        @Override
+        public void onBusinessEvent(final LoanChargeOffPreBusinessEvent event) {
+            final Loan loan = event.get();
+            if (loan.getLoanProductRelatedDetail().isEnableBuyDownFee()) {
+                log.debug("Loan pre charge-off buy down fee amortization for loan {}", loan.getId());
+                loanBuyDownFeeAmortizationProcessingService.processBuyDownFeeAmortizationTillDate(loan, DateUtils.getBusinessLocalDate(),
+                        true);
+            }
+        }
+    }
+
+    private final class LoanUndoChargeOffEventListener implements BusinessEventListener<LoanUndoChargeOffBusinessEvent> {
+
+        @Override
+        public void onBusinessEvent(final LoanUndoChargeOffBusinessEvent event) {
+            final LoanTransaction loanTransaction = event.get();
+            final Loan loan = loanTransaction.getLoan();
+            final LoanStatus status = loan.getStatus();
+            if (loan.getLoanProductRelatedDetail().isEnableBuyDownFee() && loanTransaction.getTypeOf().isChargeOff()
+                    && !(loan.isChargedOff() || status.isClosedObligationsMet() || status.isClosedWrittenOff() || status.isOverpaid())) {
+                log.debug("Loan undo charge-off on buy down fee amortization for loan {}", loan.getId());
+                loanBuyDownFeeAmortizationProcessingService.processBuyDownFeeAmortizationOnLoanUndoChargeOff(loanTransaction);
+            }
+        }
+    }
+}

fineract-provider/src/main/java/org/apache/fineract/portfolio/loanaccount/service/LoanBuyDownFeeAmortizationProcessingServiceImpl.java

@@ -20,11 +20,16 @@ package org.apache.fineract.portfolio.loanaccount.service;
 
 import java.math.BigDecimal;
 import java.time.LocalDate;
+import java.util.Collections;
 import java.util.List;
+import java.util.Optional;
 import lombok.RequiredArgsConstructor;
+import org.apache.fineract.infrastructure.core.domain.ExternalId;
+import org.apache.fineract.infrastructure.core.service.DateUtils;
 import org.apache.fineract.infrastructure.core.service.ExternalIdFactory;
 import org.apache.fineract.infrastructure.core.service.MathUtil;
 import org.apache.fineract.infrastructure.event.business.domain.BusinessEvent;
+import org.apache.fineract.infrastructure.event.business.domain.loan.LoanAdjustTransactionBusinessEvent;
 import org.apache.fineract.infrastructure.event.business.domain.loan.transaction.LoanBuyDownFeeAmortizationAdjustmentTransactionCreatedBusinessEvent;
 import org.apache.fineract.infrastructure.event.business.domain.loan.transaction.LoanBuyDownFeeAmortizationTransactionCreatedBusinessEvent;
 import org.apache.fineract.infrastructure.event.business.service.BusinessEventNotifierService;
@@ -32,6 +37,8 @@ import org.apache.fineract.organisation.monetary.domain.Money;
 import org.apache.fineract.portfolio.loanaccount.domain.Loan;
 import org.apache.fineract.portfolio.loanaccount.domain.LoanBuyDownFeeBalance;
 import org.apache.fineract.portfolio.loanaccount.domain.LoanTransaction;
+import org.apache.fineract.portfolio.loanaccount.domain.LoanTransactionRelation;
+import org.apache.fineract.portfolio.loanaccount.domain.LoanTransactionRelationTypeEnum;
 import org.apache.fineract.portfolio.loanaccount.domain.LoanTransactionRepository;
 import org.apache.fineract.portfolio.loanaccount.repository.LoanBuyDownFeeBalanceRepository;
 import org.apache.fineract.portfolio.loanaccount.util.BuyDownFeeAmortizationUtil;
@@ -102,6 +109,127 @@ public class LoanBuyDownFeeAmortizationProcessingServiceImpl implements LoanBuyD
         }
     }
 
+    @Override
+    @Transactional
+    public void processBuyDownFeeAmortizationOnLoanClosure(@NonNull final Loan loan, final boolean addJournal) {
+        List<Long> existingTransactionIds = Collections.emptyList();
+        List<Long> existingReversedTransactionIds = Collections.emptyList();
+        if (addJournal) {
+            existingTransactionIds = loanTransactionRepository.findTransactionIdsByLoan(loan);
+            existingReversedTransactionIds = loanTransactionRepository.findReversedTransactionIdsByLoan(loan);
+        }
+
+        final LocalDate transactionDate = getFinalBuyDownFeeAmortizationTransactionDate(loan);
+        final Optional<LoanTransaction> amortizationTransaction = createBuyDownFeeAmortizationTransaction(loan, transactionDate, false,
+                null);
+        amortizationTransaction.ifPresent(loanTransaction -> {
+            if (loanTransaction.isBuyDownFeeAmortization()) {
+                businessEventNotifierService
+                        .notifyPostBusinessEvent(new LoanBuyDownFeeAmortizationTransactionCreatedBusinessEvent(loanTransaction));
+            } else {
+                businessEventNotifierService
+                        .notifyPostBusinessEvent(new LoanBuyDownFeeAmortizationAdjustmentTransactionCreatedBusinessEvent(loanTransaction));
+            }
+        });
+
+        if (addJournal) {
+            journalEntryPoster.postJournalEntries(loan, existingTransactionIds, existingReversedTransactionIds);
+        }
+    }
+
+    @Override
+    @Transactional
+    public void processBuyDownFeeAmortizationOnLoanChargeOff(@NonNull final Loan loan,
+            @NonNull final LoanTransaction chargeOffTransaction) {
+        final List<Long> existingTransactionIds = loanTransactionRepository.findTransactionIdsByLoan(loan);
+        final List<Long> existingReversedTransactionIds = loanTransactionRepository.findReversedTransactionIdsByLoan(loan);
+
+        LocalDate transactionDate = loan.getChargedOffOnDate();
+        if (transactionDate == null) {
+            transactionDate = DateUtils.getBusinessLocalDate();
+        }
+
+        final Optional<LoanTransaction> amortizationTransaction = createBuyDownFeeAmortizationTransaction(loan, transactionDate, true,
+                chargeOffTransaction);
+        if (amortizationTransaction.isPresent()) {
+            journalEntryPoster.postJournalEntries(loan, existingTransactionIds, existingReversedTransactionIds);
+            if (amortizationTransaction.get().isBuyDownFeeAmortization()) {
+                businessEventNotifierService.notifyPostBusinessEvent(
+                        new LoanBuyDownFeeAmortizationTransactionCreatedBusinessEvent(amortizationTransaction.get()));
+            } else {
+                businessEventNotifierService.notifyPostBusinessEvent(
+                        new LoanBuyDownFeeAmortizationAdjustmentTransactionCreatedBusinessEvent(amortizationTransaction.get()));
+            }
+        }
+    }
+
+    @Override
+    @Transactional
+    public void processBuyDownFeeAmortizationOnLoanUndoChargeOff(@NonNull final LoanTransaction loanTransaction) {
+        final Loan loan = loanTransaction.getLoan();
+        final List<Long> existingTransactionIds = loanTransactionRepository.findTransactionIdsByLoan(loan);
+        final List<Long> existingReversedTransactionIds = loanTransactionRepository.findReversedTransactionIdsByLoan(loan);
+
+        loan.getLoanTransactions().stream().filter(LoanTransaction::isBuyDownFeeAmortization)
+                .filter(transaction -> transaction.getTransactionDate().equals(loanTransaction.getTransactionDate())
+                        && transaction.getLoanTransactionRelations().stream()
+                                .anyMatch(rel -> LoanTransactionRelationTypeEnum.RELATED.equals(rel.getRelationType())
+                                        && rel.getToTransaction().equals(loanTransaction)))
+                .forEach(transaction -> {
+                    transaction.reverse();
+                    final LoanAdjustTransactionBusinessEvent.Data data = new LoanAdjustTransactionBusinessEvent.Data(transaction);
+                    businessEventNotifierService.notifyPostBusinessEvent(new LoanAdjustTransactionBusinessEvent(data));
+
+                });
+
+        for (LoanBuyDownFeeBalance balance : loanBuyDownFeeBalanceRepository.findAllByLoanId(loan.getId())) {
+            balance.setUnrecognizedAmount(balance.getChargedOffAmount());
+            balance.setChargedOffAmount(BigDecimal.ZERO);
+        }
+
+        journalEntryPoster.postJournalEntries(loan, existingTransactionIds, existingReversedTransactionIds);
+    }
+
+    private Optional<LoanTransaction> createBuyDownFeeAmortizationTransaction(final Loan loan, final LocalDate transactionDate,
+            final boolean isChargeOff, final LoanTransaction chargeOffTransaction) {
+        ExternalId externalId = externalIdFactory.create();
+
+        final List<LoanBuyDownFeeBalance> balances = loanBuyDownFeeBalanceRepository.findAllByLoanId(loan.getId());
+
+        BigDecimal totalAmortizationAmount = BigDecimal.ZERO;
+        for (LoanBuyDownFeeBalance balance : balances) {
+            List<LoanTransaction> adjustments = loanTransactionRepository.findAdjustments(balance.getLoanTransaction());
+            LocalDate maturityDate = loan.getMaturityDate() != null ? loan.getMaturityDate() : transactionDate;
+            final Money amortizationTillDate = BuyDownFeeAmortizationUtil.calculateTotalAmortizationTillDate(balance, adjustments,
+                    maturityDate, loan.getLoanProductRelatedDetail().getBuyDownFeeStrategy(), maturityDate, loan.getCurrency());
+            totalAmortizationAmount = totalAmortizationAmount.add(amortizationTillDate.getAmount());
+            if (isChargeOff) {
+                balance.setChargedOffAmount(balance.getUnrecognizedAmount());
+            }
+            balance.setUnrecognizedAmount(BigDecimal.ZERO);
+        }
+
+        BigDecimal amortizedAmount = loanTransactionRepository.getAmortizedAmountBuyDownFee(loan);
+        BigDecimal totalUnrecognizedAmount = totalAmortizationAmount.subtract(amortizedAmount);
+        if (MathUtil.isZero(totalUnrecognizedAmount)) {
+            return Optional.empty();
+        }
+
+        final LoanTransaction amortizationTransaction = MathUtil.isGreaterThanZero(totalUnrecognizedAmount)
+                ? LoanTransaction.buyDownFeeAmortization(loan, loan.getOffice(), transactionDate, totalUnrecognizedAmount, externalId)
+                : LoanTransaction.buyDownFeeAmortizationAdjustment(loan,
+                        Money.of(loan.getCurrency(), MathUtil.negate(totalUnrecognizedAmount)), transactionDate, externalId);
+        if (isChargeOff) {
+            amortizationTransaction.getLoanTransactionRelations().add(LoanTransactionRelation.linkToTransaction(amortizationTransaction,
+                    chargeOffTransaction, LoanTransactionRelationTypeEnum.RELATED));
+        }
+
+        loan.addLoanTransaction(amortizationTransaction);
+        loanTransactionRepository.saveAndFlush(amortizationTransaction);
+
+        return Optional.of(amortizationTransaction);
+    }
+
     private LocalDate getFinalBuyDownFeeAmortizationTransactionDate(final Loan loan) {
         return switch (loan.getStatus()) {
             case CLOSED_OBLIGATIONS_MET -> loan.getClosedOnDate();

fineract-provider/src/main/java/org/apache/fineract/portfolio/loanaccount/service/LoanCapitalizedIncomeAmortizationEventService.java

@@ -100,7 +100,7 @@ public class LoanCapitalizedIncomeAmortizationEventService {
             if (loan.getLoanProductRelatedDetail().isEnableIncomeCapitalization()) {
                 log.debug("Loan pre charge-off capitalized income amortization for loan {}", loan.getId());
                 loanCapitalizedIncomeAmortizationProcessingService.processCapitalizedIncomeAmortizationTillDate(loan,
-                        DateUtils.getBusinessLocalDate(), false);
+                        DateUtils.getBusinessLocalDate(), true);
             }
         }
     }

fineract-provider/src/main/java/org/apache/fineract/portfolio/loanaccount/starter/LoanAccountConfiguration.java

@@ -123,6 +123,7 @@ import org.apache.fineract.portfolio.loanaccount.service.LoanArrearsAgingService
 import org.apache.fineract.portfolio.loanaccount.service.LoanAssembler;
 import org.apache.fineract.portfolio.loanaccount.service.LoanAssemblerImpl;
 import org.apache.fineract.portfolio.loanaccount.service.LoanBalanceService;
+import org.apache.fineract.portfolio.loanaccount.service.LoanBuyDownFeeAmortizationEventService;
 import org.apache.fineract.portfolio.loanaccount.service.LoanBuyDownFeeAmortizationProcessingService;
 import org.apache.fineract.portfolio.loanaccount.service.LoanBuyDownFeeAmortizationProcessingServiceImpl;
 import org.apache.fineract.portfolio.loanaccount.service.LoanCalculateRepaymentPastDueService;
@@ -573,4 +574,12 @@ public class LoanAccountConfiguration {
         return new LoanBuyDownFeeAmortizationProcessingServiceImpl(loanTransactionRepository, loanBuyDownFeeBalanceRepository,
                 businessEventNotifierService, journalEntryPoster, externalIdFactory);
     }
+
+    @Bean
+    @ConditionalOnMissingBean(LoanBuyDownFeeAmortizationEventService.class)
+    public LoanBuyDownFeeAmortizationEventService loanBuyDownFeeAmortizationEventService(
+            BusinessEventNotifierService businessEventNotifierService,
+            LoanBuyDownFeeAmortizationProcessingService loanBuyDownFeeAmortizationProcessingService) {
+        return new LoanBuyDownFeeAmortizationEventService(businessEventNotifierService, loanBuyDownFeeAmortizationProcessingService);
+    }
 }