This post is for these applying the education loan fees strategy and possess High Ponds as your student loan servicer. Our education loan think gurus have observed huge numbers of people not with its money securely designated during the Great Ponds. Hence, i have assembled so it walk through so you can generate sure you maximize your discounts.
“I called Great Lakes again and they are supposed to be reapplying the payments, again. The last person I talked to said the person I spoke with last week entered everything “right”, yet the money remained maybe not used precisely.”
I listen up day-after-day of FitBUX Users…. thus, what might possibly be great about which have High Lakes when they clutter up money?
Loan qualities make mistakes. Yet not, based on all of our feel, High Lakes’ customer care is 1 of the best in the fresh education loan business.
2 Important factors In making Prepayments
Let’s take a step back. When you are make prepayments to save money and pay off your student loans faster, there are 2 key elements to make sure you are doing so in an optimal fashion:
Very first, just how the prepayments are assigned. The different student loan servicers sometimes get this wrong. If they do, it will cost you thousands of dollars over the life of your loans. Read this payday loans Iowa article for more information on how to pay off student loans.
Next, finding out how High Lakes is applicable the brand new prepayment. Great Lakes does this differently than all the other loan servicers so knowing it is important.
Prepayment Allowance
- Their complete needed payment per month is the payment you have to make each month. That required payment is split into two parts: an interest amount and a principal amount. The interest amount covers how much you owe in interest each month. The principal amount is applied to your loan principal and reduces your overall balance. Check out this video on how a loan works.
You simply can’t prefer the way the called for payment try allocated all over the more loans, i.elizabeth. you can’t use your necessary payment on higher-attention mortgage very first.
- An excellent prepayment is an amount you elect to pay above your required monthly payment. The point of the prepayment is to reduce how much you owe at a faster pace. Therefore, you pay less interest in the long-run.
Detail by detail Analogy
I will assist you exactly how High Lakes enforce money playing with an example. Just like the an advance notice, you might have to reread so it a few times because of this new mathematics. You need to take-out a bit of papers and pull a period of time line….
Assumptions:
– You have multiple loans all at different interest rates.
– Your overall required payment per month are $step 1,a hundred.
– Of the $1,100 monthly payment, $900 was placed on clean out dominating while $200 will be used to pay interest. This $900 number is the one you want to remember.
– Great Lakes has a “billing cycle.” This billing cycle ends the day your required payment is due and starts over the next day. For this example, let’s assume that the battery charging duration comes to an end the fresh new 31 th of each and every week.
– You pay your required monthly payment on the 30 th of each month, utilizing the vehicle-shell out feature Great Lakes offers.
– Your next payment are February 29 th .
– You decide we want to make a prepayment away from $300 with the February twentieth and you want to apply it to your highest interest rate loan first, as this will save you the most money.