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how did i get 4 months ahead on my car loan?


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DCU

 

i rarely log into my dcu account because i only have the car loan. the payment is 250 and ive always paid a bit more but the past 8 months ive paid a lot more. usually around 400. so i decided to see the balance and logged on and it says next payment is due september, i wrote to them and they confirmed i owe nothing until september.

 

i didnt think it was even possible to build up payments like this. i dont get it. i did confirm that all my extra is going to principal every month. 370 out of 400 etc etc. so how is it possible that i'm paid ahead?  i know my regular CU says payments must be made every month no matter what.  so this is weird.

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Somebody lied to you.    You need to specifically request how to submit extra principal payments if that is your goal.  Otherwise you are paid ahead.     (Rose Factor)

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Even if they really did advance the payments, remember that each month you don't keep making a payment is a month that interest clock is adding up...

 

My student loan was like that years ago...at one point I was about 18 months ahead of their schedule.  Was not worth skipping payments.  For me, it was about clearing the thing, ditto my current vehicle note (which will be burned more than a year ahead of the scheduled five-year note). 

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1st level csr had no clue why this happens. she tried saying if your payment  is 120 and you pay 360 that you are paid out 3 months. but this cant be true. interest and principal is being correctly applied, not carried forward

 

example

 

april 30 balance was 7218 so 7218 times .05 divided by 12 is 30 and i paid 400 . they applied 29.6 as interest and 370.40 as principal which is correct by my math

 

i wasnt gonna wait 1 hour on hold with a loan person but i emailed again as to why it is sept due date.

 

every other bill  (mortgage, CC etc) always applies extra to principal and this one is as well. i think something is just messed up with the due date.

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6 hours ago, luckydriver said:

1st level csr had no clue why this happens. she tried saying if your payment  is 120 and you pay 360 that you are paid out 3 months. but this cant be true. interest and principal is being correctly applied, not carried forward

 

example

 

april 30 balance was 7218 so 7218 times .05 divided by 12 is 30 and i paid 400 . they applied 29.6 as interest and 370.40 as principal which is correct by my math

 

i wasnt gonna wait 1 hour on hold with a loan person but i emailed again as to why it is sept due date.

 

every other bill  (mortgage, CC etc) always applies extra to principal and this one is as well. i think something is just messed up with the due date.

In the end, does it matter?  You aren't one of those people who doesn't pay unless you have a current month due date, are you? 

 

Just keep shoveling money and get right side up...

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epay-forms-sample.pdf

 

I have used this contract for more than 25 years for all my banks.   Read the back portion Section ONE subsection B.  So that's why I said you need to ask your lenders how THEY prefer you tender additional principal payments.   If that is your goal.

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