# Overview

Credit notes in Loopit are used to adjust invoice balances, refund payments, or issue customer credits. They provide flexibility in managing invoices and payments and can be configured to automatically apply to the recurring invoices of a booking.

## Credit Note Types

There arere two primary types of credit notes:

### Adjustment Credit Note

<figure><img src="/files/hlwGuRxba4xNaogpE4dm" alt=""><figcaption></figcaption></figure>

* **Purpose**: Used for **adjusting** the balance of an invoice.
* **Behavior**: Automatically applied to the same invoice from which it was created.
* **Use Cases**:
  * Correcting errors in invoicing
  * Applying a discount or promotional adjustment

### Refundable Credit Note

<figure><img src="/files/1Xmd9chYhWk5bllusDNd" alt=""><figcaption></figcaption></figure>

* **Purpose**: Used for issuing a **refund** to the customer or transferring credit.
* **Behavior**: Can be applied to another invoice, or refunded electronically.
* **Use Cases**:
  * Issuing a refund due to cancellation or returns or booking changes.
  * Issuing a refund for unused periods as part of the end booking process
  * Issuing credits to a customer as a gesture of goodwill.

## Credit Note Statuses

### Adjustment Credit Note Statuses

* **Adjusted:** The credit note has been created from an invoice and **immediately applied** to the same invoice. This action adjusts the balance on the invoice without issuing a refund.

### Refundable Credit Note Statuses

* **Refunded:** The credit note has been **fully refunded** to the customer, either via their payment method or other means.
* **Refund Due**: The refundable credit note has been created but **has not been refunded** or applied to any invoice yet. It remains in an outstanding state.
* **Applied:** The refundable credit note has been **applied to another invoice**, helping to reduce the balance on that invoice.
* **Partially Applied**: Only part of the refundable credit note has been applied to an invoice. The remaining balance is still available for use on future invoices or can be refunded.


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