Posted on: 07th Sep, 2011 09:41 pm
I am making extra payments toward my mortgage. How do I know that these extra payments are being properly credited? With so much in the news about lender overcharges, how can anyone trust their lender with prepayments?
Welcome Amanda,
This is something which quite a lot of people are concerned about. The lenders never offer a statement that explains their exact procedure for crediting extra payments. I have heard that in the recent times few lenders have begun to provide borrowers with access to their payment history on the internet but it will be a long time if ever before this becomes standard practice.
This is something which quite a lot of people are concerned about. The lenders never offer a statement that explains their exact procedure for crediting extra payments. I have heard that in the recent times few lenders have begun to provide borrowers with access to their payment history on the internet but it will be a long time if ever before this becomes standard practice.
You can request your payment history at any time. Just call your lender and ask them to send it to you. By law, they must. The problem would be, how to read them. They are very jumbled and hard to follow. Some more than others. Also, when you make the check, make a separate check and write in the memo section, your loan number and payment to be applied directly to principal. You can also set up bi-weekly payments that will help cut down on 5yrs of a 30yr loan. Good luck.
Do you get a monthly mortgage statement?
The statement shows total payment and the amount that went to principal and the amount that went to interest and the amount that went to escrows.
You should be able to tell the extra went to principal.
If you do not get a statement, ask for payment history as Chris noted above.
The statement shows total payment and the amount that went to principal and the amount that went to interest and the amount that went to escrows.
You should be able to tell the extra went to principal.
If you do not get a statement, ask for payment history as Chris noted above.
This is hardly rocket science as long as you passed math 101 in high school. Rounding correctly is usually the only issue. See FNMA Servicing Guide X, Ch 4, Exhibit 2. Sorry this site does not permit posting of links so no convenience for the posters.
The is mostly a scam to sell newspapers. Possible for a lender to make an error so not a bad idea to run a schedule in Excel. You might ask your LO for a spread sheet; every LO has one on their laptop. Cross checking if you don get monthly statements is an issue but one a year off annual statement would normally suffice. Errors are very rare but rust but verif.
The is mostly a scam to sell newspapers. Possible for a lender to make an error so not a bad idea to run a schedule in Excel. You might ask your LO for a spread sheet; every LO has one on their laptop. Cross checking if you don get monthly statements is an issue but one a year off annual statement would normally suffice. Errors are very rare but rust but verif.