Mortgage Payment Bi-Weekly
Author: Cyberlayde
Posted: Wed Oct 27, 2004 12:49 pm
Post subject: Bi-weekly Mortgage
Years ago, when you had a bi-weekly mortgage, you paid every other week and it got credited to your account immediately. Hence, the big savings in knocking off years. I thought this was still the case but it's not. I refinanced my house last year and was recently approved for a bi-weekly mortgage. I signed up right away, because I was told how many years I can save off my orginal mortgage paid off date. However, when my first payment was deducted from my checking account, it did not appear as posted to my mortgage. I waited a couple of days and still not posted. I called my mortgage company and found out something I was never told! The company that takes out my payments sits on it and it only gets sent to my mortgage company when they have a full months payment! So, I was being charged $8.00 per month for the priviledge of letting this third party gain interest on my money each month! I immediately opted out of this plan and went back to the orginal. At least I can send in extra payments each month and have it immediately posted and knock off years without this crap. Is anyone else aware of this scam?
Author: Ira
Posted: Fri Nov 05, 2004 3:22 am
Post subject: Bi-weekly Mortgage
Bottom line is never pay somebody to do what you can just as easily do yourself. I was once recruited by a company offering bi-weekly mortgages, but declined as soon as I saw that the homeowner didn't need me since they could send in as many payments as they want and accomplish the same thing.
Author: Hesiden
Posted: Fri Jan 14, 2005 12:36 pm
Post subject: Bi-weekly Mortgage
Most of the benifit if bi-weekly is you end up paying 13 times a year instead of 12 times. 56 weeks per year 56/2=13.
IMHO, the easy way to do this is to send an extra 100 or so with each monthly payment. There are plenty of calculator on-line to see how many years faster you can pay off your mortgage and how much intrest you'll save.
Author: NightStar
Posted: Fri Jan 14, 2005 5:00 pm
Post subject: Bi-weekly Mortgage
Yea when we first got our mortgage the company was sending solicitation all the time for this, and there is absolutely no way that I am willing myself to let any company have access to with drawing out of my checking account that is just an accident waiting to happen if they try to take funds when they are not there... easy way to default your mortgage.
Just rather control the situation myself and pay when I know the money is in the bank. I was not making more payments myself, I was just adding extra $50 here $50 there ... every payment I put extra money marked just for principle balance.
_________________
Best Regards,
Pammila Phillis
Board Monitor
http://www.cardratings.com
501-663-0314 PH
Author: Homedreams
Posted: Tue Jan 18, 2005 11:17 pm
Post subject: Bi-weekly Mortgage
Somebody got their clever hat on and decided they could make some money on this idea. You did the right thing by opting out of the program. Everyone has the right answer on this one, just make sure to write a separate check with Principal Payment in the memo, and include the notation on your remittance. This way, you will have documented proof of the exact dates and payment amounts. I have heard about a few horror stories where these extra funds have been placed in escrow accounts, "because there was no indication of where to apply the extra payment."
Another thing they never tell you is, for a thirty year loan (reduced to 22 or 23 years), you would pay around $2,000 for this "convenience."
Good question.
Posted: Wed Oct 27, 2004 12:49 pm
Post subject: Bi-weekly Mortgage
Years ago, when you had a bi-weekly mortgage, you paid every other week and it got credited to your account immediately. Hence, the big savings in knocking off years. I thought this was still the case but it's not. I refinanced my house last year and was recently approved for a bi-weekly mortgage. I signed up right away, because I was told how many years I can save off my orginal mortgage paid off date. However, when my first payment was deducted from my checking account, it did not appear as posted to my mortgage. I waited a couple of days and still not posted. I called my mortgage company and found out something I was never told! The company that takes out my payments sits on it and it only gets sent to my mortgage company when they have a full months payment! So, I was being charged $8.00 per month for the priviledge of letting this third party gain interest on my money each month! I immediately opted out of this plan and went back to the orginal. At least I can send in extra payments each month and have it immediately posted and knock off years without this crap. Is anyone else aware of this scam?
Author: Ira
Posted: Fri Nov 05, 2004 3:22 am
Post subject: Bi-weekly Mortgage
Bottom line is never pay somebody to do what you can just as easily do yourself. I was once recruited by a company offering bi-weekly mortgages, but declined as soon as I saw that the homeowner didn't need me since they could send in as many payments as they want and accomplish the same thing.
Author: Hesiden
Posted: Fri Jan 14, 2005 12:36 pm
Post subject: Bi-weekly Mortgage
Most of the benifit if bi-weekly is you end up paying 13 times a year instead of 12 times. 56 weeks per year 56/2=13.
IMHO, the easy way to do this is to send an extra 100 or so with each monthly payment. There are plenty of calculator on-line to see how many years faster you can pay off your mortgage and how much intrest you'll save.
Author: NightStar
Posted: Fri Jan 14, 2005 5:00 pm
Post subject: Bi-weekly Mortgage
Yea when we first got our mortgage the company was sending solicitation all the time for this, and there is absolutely no way that I am willing myself to let any company have access to with drawing out of my checking account that is just an accident waiting to happen if they try to take funds when they are not there... easy way to default your mortgage.
Just rather control the situation myself and pay when I know the money is in the bank. I was not making more payments myself, I was just adding extra $50 here $50 there ... every payment I put extra money marked just for principle balance.
_________________
Best Regards,
Pammila Phillis
Board Monitor
http://www.cardratings.com
501-663-0314 PH
Author: Homedreams
Posted: Tue Jan 18, 2005 11:17 pm
Post subject: Bi-weekly Mortgage
Somebody got their clever hat on and decided they could make some money on this idea. You did the right thing by opting out of the program. Everyone has the right answer on this one, just make sure to write a separate check with Principal Payment in the memo, and include the notation on your remittance. This way, you will have documented proof of the exact dates and payment amounts. I have heard about a few horror stories where these extra funds have been placed in escrow accounts, "because there was no indication of where to apply the extra payment."
Another thing they never tell you is, for a thirty year loan (reduced to 22 or 23 years), you would pay around $2,000 for this "convenience."
Good question.
posted by CardRatings.com at 5:09 PM
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