Mortgage Pmt

Discussion in 'Credit Talk' started by tmdlkwd, Aug 6, 2003.

  1. merlin

    merlin Well-Known Member

    Re: Re: Re: Mortgage Pmt

    In response to the OP:

    For fifteen years, I have always paid my mortgage on the last few days of the grace period. No interest has ever been added to my balance. I have refinanced five separate properties MANY times with no hassles. I have also purchased a number of properties with no problems. I have no late payment marks on any of my mortgage TLs.

    I recently refinanced with Countrywide and at first they would call me at the beginning of the month to ask about my mortgage payment. I rechecked my mortgage papers and it quite clearly states that a timely payment is considered to be a payment "received no later than 5:00PM on the late charge date . . ." so I didn't worry about it and after awhile (and a solid payment history) they quit calling.

    I would suggest you re-read your mortgage papers if you are concerned.
     
  2. iambroke

    iambroke Well-Known Member

    Re: Re: Re: Mortgage Pmt

    In my case and situation taking the interest (about 5k) off my taxes isn't feasible as it's not more then my standard deduction.

    I have a HELOC with zero balance for emergencies if need be but I also have 6 months income saved in a money market also which is liquid. I pay my credit cards off each month also.

    Therefore my extra money goes to my 1st mortgage which cuts down my term. I will be totally debt free in about 8 yrs.
     
  3. GEORGE

    GEORGE Well-Known Member

    Re: Re: Re: Mortgage Pmt

    DUE ON THE 1st...is just that...

    I send the payment like between the 20th and the 25th of the PREVIOUS month...

    My payments have taken between 3 days to 10 days to post...AND IT GOES TO A STATE THAT IS "NEXT-DOOR"

    I WOULD NEVER THINK OF PUSHING THE "LATE DATE"
     
  4. Hedwig

    Hedwig Well-Known Member

    Re: Re: Re: Mortgage Pmt

    GEORGE, why not have it debited from your checking account on the first and not worry about a check? Greatest thing I've ever done.
     
  5. GEORGE

    GEORGE Well-Known Member

    Re: Re: Re: Re: Mortgage Pmt

    Because I can NOT make a "DIFFERENT" payment amount "ON DEMAND" (EXTRA PRINCIPLE)...so you end up sending a check anyway...

    I want them to come into THIS CENTURY WITH ON-LINE PAYMENTS!!!

    Like TARGET VISA and BANK ONE...you can tell them to PAY $112.09 on 09/01/2003...even WEEKS or MONTHS before the fact!!!
     
  6. jshimmer

    jshimmer Well-Known Member

    Re: Re: Re: Re: Mortgage Pmt

    That's why you get the HELOC *now*, while you are working. It's just a big credit card, waiting for you if you need it. Many people get the HELOC, and then it sits with a zero balance for years and years. If you lose your job --- bingo, you've got the $ from equity without worrying about getting approved AFTER you've lost your job, got hit by that medical condition, etc.

    They aren't going to say, "Gee, he's had this HELOC for 5 years but hasn't used it, so let's close it" or "let's keep calling his employer to make sure he has a job and, if he loses it, let's close his HELOC account".
     
  7. jshimmer

    jshimmer Well-Known Member

    Re: Re: Re: Re: Re: Mortgage Pmt

    Who need online payment programs with the CREDITOR?

    All you have to do is use a bank that offers electronic banking with a program like MS-Money.

    ALL my bills except for two are set up to be paid electronically. The only two that aren't are for the two child care facilities, as they like you to write them on Friday at the end of the week, for the upcomiing week.

    You can set it up to either (a) automatically send the payment on a certain date or (b) every e-Pay has to be done manually. With (b), you can send whatever amount you want, and you can tell the bank when you want it to arrive at the creditor, whether it's a week down the road or a year down the road.

    If the creditor accepts electronic payments directly into their account, that's what they get. If they don't, my bank actually cuts a check and mails it to them.

    All my bills (except those two) are set up as recurring bills. However, I don't let the program send them without manual intervention. Every day, I fire up MS-Money, and it tells me what bills are due and when they are do, and I can approve (send) the payment in whatever amount I want and make it arrive @ the creditor when I want (which is when it's debited from my account).

    Every day, I get the bills out of the mailbox and verify them against MS-Money's upcoming bills, for bills that have due dates that jump around two days this way or three days that way each month. And I adjust minimum payments as the bills come in each month.

    You set up your recurring DEPOSITS this way, too.

    In addition, ALL transactions with the account are automatcially downloaded from the bank and added to my checking account in the program. It matches up my manual entries with the ones it downloads, and adds new entries for ones I may have forgotten about (e.g., an ATM withdrawl, a debit card charge at the corner store, etc.).

    Balancing your account couldn't be any easier. Heck, unless there's a mistake at your bank, your account is ALWAYS balanced in MS-Money.

    Best part of all: My bank charges $4.95 a month for this service. Unlimited number of bills. I don't have to buy checks or stamps. I don't have to WRITE checks, address envelopes, lick stamps or go to the post office to mail them.

    Online bill pay (via MS-Money) has done for my checking account what my ATM/Debit card has done for trips to the grocery store, the drug store, the dentist and doctors offices or ANY business that accepts Visa. I rarely every carry cash.
     
  8. iambroke

    iambroke Well-Known Member

    Re: Re: Re: Mortgage Pmt

    Trust me--you won't get a HELOC if you've lost your job, have a major illness with no hope of return to work, etc. They want to see income to repay the loan. Also, over the long term, investments will outperform the interest you're paying on the loan.


    That is why you don't carry a balance on it. You take it out for emergencies and keep it. Mine lasts for 20 yrs so I have it for that long and then if I need it I have it. Equity is a GOOD thing in a home. If you can pay a mortgage off early it's better then keeping a balance, paying interest on it. Taxes won't net you much when you take it off your taxes anyways. You have to pay alot in interest to even go over the standard deduction for married filing jointly.

    As for investments outperforming interest on a HELOC....not too many do unless you put it into a mutual fund with much higher risks then a savings acct....My HELOC interest rate right now is 6%...can't get that on a money market that is liquid. Since I don't carry a balance I have money available for emergencies. That is the only reason I took it out.
     
  9. PsychDoc

    PsychDoc Well-Known Member

    Sometimes "too much" really takes it on the chin for representing a pro-lender view, but I think his very polite points here are worth remembering. The fact is, just as he says, the mortgage due date is the first of the month rather than the grace period date, and it is worth remembering that some -- even if not all (which really wasn't his point anyway) -- lenders will treat differently those homebuyers who demonstrate a pattern of late payments.

    An important aspect of credit repair is changing your habits. Before I became involved with consumer activism and credit repair (back when my FICO was 562), I was late with everything. Nowadays I'm never late if I can help it because I've worked really hard for those extra two hundred FICO points. I know I'm not alone regarding this either. I've always maintained that Creditnet members who are well into their credit repair are among the most reliable payers around.

    Finally, with respect to another point discussed in this thread, I don't think a home equity loan (HELOC) should be relied upon as an emergency fund. In that regard, I'm a DaveRamsey.com proponent. A home equity loan can indeed be very useful, but so can an emergency fund. Of course I realize that establishing an emergency fund doesn't happen instantly and can't happen for so many people who are battling hard times right now. However, as a long-term goal, gradually saving up an emergency fund of three to six months of income is a very smart thing to do and combats that old [true] statistic regarding people being just one tragedy away from insolvency.

    I know that when "too much" makes points which encourage different habits regarding payments, spending, and saving, he is cast as a villain. However I hardly think anybody can credibly call me anti-consumer, and I believe it's useful to have people on this board actively committed to those very helpful views as well.

    Doc
     
  10. iambroke

    iambroke Well-Known Member

    Finally, with respect to another point discussed in this thread, I don't think a home equity loan (HELOC) should be relied upon as an emergency fund. In that regard, I'm a DaveRamsey.com proponent. A home equity loan can indeed be very useful, but so can an emergency fund. Of course I realize that establishing an emergency fund doesn't happen instantly and can't happen for so many people who are battling hard times right now. However, as a long-term goal, gradually saving up an emergency fund of three to six months of income is a very smart thing to do and combats that old [true] statistic regarding people being just one tragedy away from insolvency.

    I do agree HELOC's are not the ONLY vehicle for emergency funds. I keep mine in a MMA at 6 months income to cover expenses.

    BTW: What should a HELOC be used for in your opinion?

    Mine was taken out 3 yrs ago for home improvements (new roof, siding, etc...) Paid it off very quickly but did carry a balance for a year or so.
    It came in useful for that situation but since I opened it I haven't used it again...since I have it for another 17 yrs I figure I'll keep it just in case. Doesn't hurt me since my balance is zero....
     
  11. PsychDoc

    PsychDoc Well-Known Member


    I think you present a terrific example of smart HELOC usage and repayment.

    Doc
     
  12. lbrown59

    lbrown59 Well-Known Member

    Re: Re: Mortgage Pmt

    Another thing you can do is pay the regular monthly payment plus the interest payment each month .
     
  13. lakpr

    lakpr Well-Known Member

    Re: Re: Re: Mortgage Pmt

    I'll bite ... I do not understand what you are saying ... can you please explain in a little more detail?

    Thanks.
     
  14. lbrown59

    lbrown59 Well-Known Member

    Re: Re: Re: Re: Mortgage Pmt

    that he could take the equity out.
    Hedwig
    ===============
    Did you know getting the equity out of a home is just like getting cash value out of life insurance and has the same drawbacks?
    THE END ** *** ** LB 59
    """"```~~~```'""'''
     
  15. lbrown59

    lbrown59 Well-Known Member

    Re: Re: Re: Re: Mortgage Pmt

    What I stated above will work on any kind of a loan.
    Simple example
    If your payment is 200 a month and your interest is 50
    Pay the 200 monthly payment with one check and have the 200 applied to principal. Pay the 50 with a separate check and have it applied to Interest.
    This will knock the principal down faster and reduce the finance cost as well as shorten the length of the loan.

    THE END ** *** ** LB 59
    """"```~~~```'""'''
    PS
    I have used this trick many times to pay of credit cards and other loans quicker.
     
  16. dstdiva

    dstdiva Well-Known Member

    Re: Re: Re: Re: Mortgage Pmt

    lbrown,

    can you explain why you need to send that in 2 checks? wouldn't 1 check for $250 give you the same effect? i'm confused...
     
  17. GEORGE

    GEORGE Well-Known Member

    Re: Re: Re: Re: Re: Mortgage Pmt

    My "TICKET" I put in with the payment has line items for...

    LATE CHARGE
    ADDITIONAL PRINCIPAL
    ADDITIONAL ESCROW

    TOTAL REMITTED
     
  18. jshimmer

    jshimmer Well-Known Member

    Re: Re: Re: Re: Re: Mortgage Pmt

    No. Write a separate check. In the MEMO, put something to the effect of "APPLY TO PRINCIPAL ONLY". Avoid confusion, and stops them from trying to claim it was part of NEXT month's payment (and, thus, robbing you by carrying that principal for the remaining years of your mortgage).
     
  19. lbrown59

    lbrown59 Well-Known Member

    Exactly
     
  20. iambroke

    iambroke Well-Known Member

    Re: Re: Re: Re: Re: Mortgage Pmt

    I send one check showing my excess principal and then my payment for that month.

    So, If I want to pay 200 more per month I pay that in one check and notate 200.00 to principal. Has always worked for me.

    I'm alittle confused as to how 1 check has to be written as 2 checks? Won't one suffice? It has for me for many years.
     

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