I have to laugh, when I started the monthly overpayments, which I wanted the "extra" to go to principle only, my bank royally messed it up. (several times) After many phone calls, my account was sorted out, and they did the right thing, and applied the extra payments when they should have been applied, but my solution was on my statement ticket (the bottom portion I sent back every month) I included bright colored (red) arrows and instructions showing the full breakdown of the payment I was sending. I actually wrote out the math equation version of payment + principle only = total enclosed, and annotated each line as such. (I wrote the same on my checks) After about a year of annotating my "ticket" the bank revised their monthly statements, and included lines where you could add in any additional principal or interest that you were sending in each month. I'm not sure if my comical notes were the cause, or just a needed overhaul, but I've never had an issue with them mis-applying our payments since I started that, and now that they have made it clear on their tickets, it's been much easier to add the extra in each month!
Mike Jay wrote:This is critical when paying extra! Otherwise they'll happily just apply it to the interest, which is in their best interest When doing this online, there should be a check box or something to ensure extra payments are going towards principle.
Mike Barkley wrote:Write in the note section of the 13th check "paid toward principle only".