Posted: Sun Aug 10, 2008 8:50 pm Post subject: What is a deferred interest fee
I was told I was being charged over $300 for a deferred interest fee, yet this was never told to us. When we signed the papers to rework the payments, there were 0 costs, we have never been late. I'm still not getting any answere's from my lender, it doesn't matter how many times I call, I am getting the runnaround. I pay $216.21 extra per month towards the principal and for 2 months now that extra money is nowhere to be found! Can someone please help me understand why this is happening? Thanks for any help you can suggest.
It may be because you are making extra payments. So, the lender is charging the deferred interest fee such that he can recover the interest you don't have to pay as because you will be prepaying the mortgage with extra payments. _________________ Procrastination is the enemy of your financial sucess
Posted: Mon Aug 11, 2008 4:05 pm Post subject: Deferred Interest
Thank You, Adonis,
So let me ask you this, if I pay the amount that is Amortised before the final due date which would be the 15th of the month, I won't be charged a fee?
Anytime you send in an additional principal payment with the current mortgage payment (for example, in the month of August, the regular August payment plus $X to be applied to principal) the lender “loses”, i.e., has to advance from their own funds, and amount equal to interest for one month on the additional principal amount if your mortgage is in a pool.
Never heard for a lender trying to recover from the borrower; it’s just a cost of doing business. Although 99% of the additional principal payments are made on “current” mortgages, if the loan is prepaid by one month, it is a “wash”. Yes, there is “recovery” if the loan is prepaid 2 or more months. Has to do with “real time” and projections in “pool time.”
Ask for a ledger history of your account. The additional principal payments have to have been applied. Also doubt if they can really enforce this “deferred interest fee” unless there is a special prepayment penalty or yield maintenance clause in your mortgage …. Very doubtful.
sooclean
