if u have extra $$$ and want to make toward the principal?

Question

if u pay ur mortgage payment and still have some extra $$$ left to apply toward the principal...do u send it in separate check and said it apply to the principle only? or you send it on the same check? also what happen if the lender apply it toward ur next mortgage payment instead toward ur principal?

does ur lender send u each monthly statement saying how much u pay toward ur principal and interest each month or only at the end of the year? if u have the extra $$$, and like to contribute it toward the principal, do u do it at the end of each month or at the end of the year? thx in advance.

Answer 1

Your payment coupon should have a place for extra principal and you can put it on the same check. Most don't send monthly statements but you can look on line. I would send it in as soon as I had the extra if I were going to do it at all.
I used to do this when interest rates were high it is a great idea when you are paying more than about 8% but at rates under 7 you might be better off keeping the money to invest. Market returns are higher but more risk.
Paying extra on a mortgage doesn't give you better cash flow until it is paid off unless you have an ARM so if you knock 10 years off the mortgage you don't see the money for 20 years or until you sell. Investing it instead gives you flexibility.

Answer 2

1. Some lenders have a prepayment penalty. It will be in the mortgage papers or in the p-note.

2. Send in the principal payment as a separate payment and note as such on the payment.

3. Call the lender and tell them the extra $$ are for the principal reduction and NOT to be used for additional escow. Remember the principal reduction payment is normally less than the PITI.

4. In the beginning of the new year the lender will send a statement reflecting the amount of interest paid during the previous 12 months as well as what the outstanding principal balance is.

5. Principal reductions can be sent to the lender any time during the year.

6. Remember, regular monthly/biweekly mortgage payments (PITI) must still be made.

Answer 3

Your payment coupon should have a separate space where you indicate additional principal amount. You can send it in one check with your mortgage payment every month.
If for some reason your payment coupon doesn't have this space (usually marked "additional principal" or something like that) just call your mortgage company and they'll tell you how to do it.
They WILL put it towards principal, not towards next month payment. It's done all the time and mortgage companies are not surprised to see an additional payment (as long as you indicate it on the coupon.)

Answer 4

While many payment coupons offer a space to differentiate payment only meant towards the principal, I suggest you send a separate check with PAYMENT TOWARDS PRINCIPAL written in RED INK on the check TO AVOID ANY CONFUSION. Or, do the same thing in a completely different envelope.

My lender sends me a statement of the amount of my principal and escrows every month, but gets "reviewed" once a year to make sure I am paying enough, or not enough due to higher tax valuations and changing insurance premiums. You should feel free to pay money towards your principal at any time.

Answer 5

Doesn't your statement show principal, interest, and escrow payments each month. When you send in your payment tell them extra towards principal

Answer 6

We save it til near the end of the year and send it all in one extra check with a letter directing it to be put toward the principal. If you do this every year, one extra payment a year, it'll pay off your loan alot sooner.

Answer 7

i have not heard about Capital One vehicle Finance yet I recommend you larger search for suggestion from with their shopper provider and ask your queries that you'll have direct solutions for your concerns.