What are Principal Payments and How Can They Help You...
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- Опубліковано 6 сер 2024
- Principal Payments are essential to help you off pay any loan car, home mortgage, etc
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Principal payments are the best way to pay down a loan or to pay off a loan early. The loan could be a car or auto loan, personal loan, student loan or even a mortgage. It doesn’t matter making principal payments will help you pay off the faster and save you a lot in interest along the way. This is because every payment you send in for the principal is goes 100% towards reducing your principal balance. This is important be this what is used to calculate how much interest you owe that months. The the benefits are twofold. You pay down your principal and you save on interest. Win-Win!
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I paid my car off a year early paying towards the principal.
That’s a win! What are you going to do with that new found money?
@@DiamondEdwards have they ever given you a hard time or refused to take principal payments?
Thank you for explaining this in such a simple way for we common folks to understand! 💛
Thank you so much for all your information !!!
Thank you for this video you make it easier to understand ! I will now be doing principal payments !!
This was very informative. Thanks for making it short and simple.
Thanks for explaining it in a simple way
This was the most helpful video I found concerning principal payment. Thank you.
Great powerful info .THANK YOU
Very helpful, thank you so much!
Thank you! Super helpful
You truly are a diamond! Finally a simple answer to principal because I just didn’t understand it. Now I can pass the word and help other.
So glad you found this helpful! Thank you for watching and sharing😃
Now I know exactly what to do. Adding extra more to my note was probably going to interest. 👍
Thanks
Thanks for your information 👍🏼
You are the best!!! Thank you!
Thanks for explaining
Thank ❤you so much so helpful
Thanks very informative
Helpful. Thank you.
Loved this video!!!
Thank you brother!
I subscribed my brother . Keep dropping that sauce
Good info, thanks
Great video!
Great video
Excellent video . I'm about to save 3000 in interest this year. Thanks a tonne !
Thank You.
Wow thanks for walking thru with the calculator
Watched Ramsey. You explained it better thx
This was very good and very informative. It's not exactly what I was looking for.
It was actually in the reverse calculation of what I was trying to understand...how does principle work on weekly deposit earnings.
I like the way you took your time and explained everything very thoroughly and I appreciate you.
I did subscribe and I will continue to learn more from you.
Thank you so much...I'm very serious thank you❤
Great Video!!
This was amazing
Thank you
Thank you so very much! I’ve been trying to find the answer to this for quite a while and you made it clearer than anything I’ve found so far.
Glad it helped you out. Thanks for watching and supporting.
A fellow Diamond here. Your content is so straightforward and easy to understand. Thank you so much for providing this information! Thanks to your videos I am in the process of refinancing my car AND making the principal payments to pay it off!
Such a great article lesson learned I made my first principle payment today.
Thank you for this information and a very clear explanation .
Glad it was helpful!
This was super helpful! Thanks!
Glad it was helpful! Check out some of my other video. You may find those helpful too. Welcome to the community!
THANK YOU FOR THIS.
No problem!
Thanks man. Great video. You got a new subscriber.
Gonna share your video, as well. Take care!
Thanks for the sub and I appreciate you sharing my videos! Welcome to the community!!!
Thanks
Love your work my man!
Glad you enjoy it!
Subbed and noti gang!! This was useful
Thank you. U have cleared out a lot of confusion in my head. But I don’t know if I want to sell my 5 year old car that I don’t like, and start a new loan and pay principle on the car I really want.
Great video....as a thank you I have subscribed
Awesome, thank you!
Thank you for the thorough explanation. I recently submitted my monthly car payment and I accidently put it toward my principle payment. Unbeknownst to me, I was notified that my regular monthly payment was behind. After talking to a representative, they were kind enough to help me get it straighten out. I’m not very skilled in this area, hence why I watched your video today. I thought the payment would still be applied the same regardless if it was toward the principle or not. Happy Holidays
5:38 Thanks for watching. I glad they got you straight. Another option would have been to make a second payment in the amount of interest due for that month.
Excellent video, Diamond! Great inspiration too!
Great video 😁
Great information
Thank you!
Great video! I was shocked at the disclaimer. A prepayment penalty, they want people to fail with their games. 😤
I’m glad i watch till the end, I was just about to make an interest payment until you said to make regular payment for than interest only. Thanks for the tips!
It's exciting when you see how easy it is to save money. Always make your regular payment 1st because you are to pay the interest due each month. Thanks for watching.
@@DiamondEdwards appreciate ya!!!
Great video because I was so confused on when or how do I do a principal only payment. Thanks you
I guess Im kind of off topic but do anyone know a good place to watch newly released movies online ?
@Anders Lian try FlixZone. Just google for it :)
@Anders Lian Lately I have been using Flixzone. You can find it on google =)
I have foreign parents so they were not educated ok credit since Our country do really run on credits lol . However , you are my American dad and thank
You so much for this info .
🙌
Thank you so much for tell us to make a regular payment before made a principal payment. What happen if I just made a principal payment and didnt make a regular payment?
Your video is great. One question, would adding in the memo section "Overage to Principal Curtailment" with extra payment work the same way...or, should we make a separate check for principal-only payment?
Thank you so much for this video! I’m 25 years old and I was lucky enough to have my former math high school teacher talk about loans etc. Having that exposure was great and I had to teach myself later in college. Thanks for explaining this thoroughly! Now I know how to get a head start with my loans ❤️👌.
Awesome, I’m glad this content was useful!
That's great, I knew about this years ago and applied this information and continued to use it today for small personal loans it definitely helped me.
Thank you tremendously for sharing this information.. You have changed my life. May the good Lord bless you abundantly ❤❤❤
Where is this particular loan calculator at?
Wow. First time hearing don't make regular and principal payment at the same time. I'm going to relisten to the entire video to make sure I heard it right.
Definitely using these tips for our next car. This stimulus check/tax refund is going towards both debt and emergency fund. I'm sick of this auto loan but it'll have to wait till these other smaller loans are dead.
Sounds like a plan! Thank you for the sub! What method are you using to pay off your debt? I used the debt snowball with great success. Good luck and be sure to check out my other videos on getting out of debt. It’s hard work but so worth it.
@@DiamondEdwards yes sir! We're utilizing the debt snowball method.
@@Akuma2unlimited keep it up on the debt snow ball ! only payment I have is a mortgage
Thank you for this information brother!!!, like u said, that debt snowball, take that 1 at the very top with the highest interest rate and u hit that 1 with everything you got!!!Man I felt that and ima roll with that 1, thanks brother, I got two Auto Loans, TWO!!!, and I have to get rid of both of them and I will!!
Highest interest or smallest balance is fine. The key is to pick a method that will get your fired up and not discouraged. Getting out of debt is mental challenge not a math problem.
@@DiamondEdwardsthank you brother and I love your content and I watched your videos, bro I had two auto loans, bro TWO, I just paid off 1 of my auto loans after just 19 months, and my balance was $27401 on a 7 year term , your content helped me, thank you brother, i gotta story bro to tell bro, thanks to you showing me about the power of the principle payments
Can you 3xplain more in depth about how to make sure the princapal payments are applied correctly? When it is a principal only payment it should reduce the overall balance right? But then the monthly payment still comes through. Whereas an extra payment would not reduce the balance owed?
What's good bro I was wonder if I could talk to you one on one about this concept let me know. Thanks
Thank you for this information!It's so valuable! I have one question though. Not sure if you have mentioned this before in another one of your videos. Sorry if you have- Does this apply to credit card debt as well?
Unfortunately the answer is NO. There is no way to avoid interest on a CC other than playing the transfer game. Check out the snowball method for CC debt. ua-cam.com/video/tJiLVA0n32s/v-deo.html
@@DiamondEdwards thank you so much! will check out the video. I appreciate you
Good question.
Whats up Diamond, i got a question. So I split my monthly car payments into two. When should I pay my principal payments? Should I pay it in between the weeks I don’t get charged or after my final payment?
Thanks to you I paid my principal payment! At first I think they made my extra payment go to each month and I was confused. But they corrected it. Thanks to you my 7 year loan will actually be 2 years if I keep at it! I have a question any idea how to refinance for a better APR? I went to my local credit unions and they all suggested I utilize my credit more. I have a great credit score but the utilization is at 1%. What are ways to build my credit up as well as utilize it more. I want to ideally do this in 6 months so I can get a better APR for my auto loan. Advice is truly helpful. This is a case of having a great credit score but hardly no credit history.
How do you make the payment to the principal?
Hi Diamond, I have a car loan coming up. Spoke with the lender, and told them I want to make the principle payments first, and then car payments later. Also, there’s no penalty for doing so. I would like your input.
Which calculator you used
Im so upset found this vid a couple months late after i been paying extra on my payment then my bank says i was suppose to send 2 payments on one day one reg payment and the other principal
after the storm and texas we have to fix we are roof we used lowe's credit card but the bill don't said if we can give extra pricipal payment in our account should transfer to other credit card or I stay with the same credit card the interest is almost 8 percent
There is no Principal Payment option” on credit cards however the interest owed is still calculated based off the balance and rate so by quickly paying down the balance you will save on interest paid. How fast can you come up with $8k? Are you just trying to pay this one account off or are you trying to become debt free? What method are you using to pay off your debts? I think you should really check out my latest video. ua-cam.com/video/nAuFbytdyZg/v-deo.html
I just made a $25.00 principle payment to test the waters and my balance stayed the same but $25.00 went to Finance charge
Can credit score get better faster by paying principal?
how can i make sure that the extra payments are going towards the principal and not towards the interest???
My credit Union app doesn’t have a option to pay principal, what do I do?
Hi I would like to know about refinance for my car. What are your views on this subject. Thanks in advance
My detailed response...ua-cam.com/video/EeKYDRi2THM/v-deo.html
Question….my payment due date is the 28th of every month, do I have to make that PRINCIPAL PAYMENT before the END OF THE MONTH or just make sure I pay the PRINCIPAL PAYMENT before my NEXT payment is due on July 28th?
I'm already upset that the dealer said my score is 760 , the car was $14,000 but my interest rate is 10.8%.... I shouldn't have agreed to this contract. My note is 331 per month. I made 3 extra payments and then a couple on principal only. So when i log into capital one it shows that my original amount is $17,399 for 73 months and my payment for this month is $179. The email reminder still says $331. Do i pay 331 and then something extra later for principle only... or do i pay $179 and throw the rest on principal only?
It is very hard on student loans
What if I pay extra on my monthly payment AND do a principal payment? Would that help? I have bout 34k left and I’m trying to pay about 1700 a month on it to get it over with faster.
Great video I just have a question about the principal cause I called my Santander bank and ask them if I already made my monthly payment, can I make a payment to my principal only they said no cause I’ll have to pay interest ... don’t really know to much about this so just wanted to know if that true
When I hear Santander I hear "REFINANCE"! Paying your loan shouldn't be difficult. Ask or check your loan documents to see if you have a prepayment penalty. If you don't have a penalty, then you can make extra principal payments. If you do, then they are correct per your agreement you have to pay all the interest calculated through the life of the loan. In that case principal payments will not make a difference and that is reason enough to refinance with a different bank or credit union. Check out NFCU or DCU they both have good rates. "Not sponsored"
What day of the month is best to pay on The principle; I heard pay one day before mortgage due is best bc of daily Interest or something like that..¿
It's splitting hairs at that point but the first day of the of billing cycle is best. The daily interest is the reason.
I must say, your video has been very helpful. You're the best, some of the other videos on UA-cam. had me way more confused, while other's talk way too much rather than getting to the point. You've gotten straight to the point. Keep up the great work!👍🔥🔥🔥🔥
Hello! So, make a payment with extra money automatically will it reduce interest? there is something like I'll pay $500 more to the principal or something like that? I heard from the people if are you making your payments but, the bank is charging only the interest but no in the principal and this is my worries.
I called customer service to make a payment of 300$ to the principal a week after my monthly payment was due. Only 186 went to the principal balance the rest went to interest
Sounds like they did not apply the payment correctly. I would get them back on the phone and have them fix there mistake. When applied correctly the entire payment will go towards the principal balance and your total balance will be reduced by the amount of the payment. If they are hard to deal with I would look at refinancing with a better company with a better rate. I should really do a video on refinancing a car loan! Update me if they fix it or not. Thanks for watching.
Yes! Do you have a video on refinancing a car loan? That is what I’m looking for right now.
What would be a good monthly principle payment?? My monthly car loan is $375.25. Thanks!
As big as you can afford! In my video "5 Tips to Paying Car Loan Off Early" I suggest you make them as big and as often as possible because car payments suck. That is if your goal is to get rid of your car payment ASAP.ua-cam.com/video/NoXHrcdZItI/v-deo.html
This would have saved me from a headache had I seen it before making a principle payment and not my scheduled payment separately😩 thank you for this information, I love the way you explained everything.
i have 100.00 go towards every month is that good??
i have a new auto loan.. my lender states "Funds received in exccess of the total amount due will reduce your principal balance and also be applied to future payment(s). " my plan was to pay some over the scheduled monthly payment and then make that payment bi-monthly on the 1st and 15th. The first due date is this April 11th but i was going to start with a full payment+ on April 1 then begin the bimonthly half payment on April 15th and the remaining on May 1st which will keep me 11 days ahead of my due date. and im thinking according to their policy i will be subtracting from the principal and given the bait to make a lower payment each month as they reduce the payment owed for the next month. What do you think about my plan and doing bimonthly. They do also allow for a principal only separate payment but i kinda like the idea of a cushion in case i have a hardship month.
anyone who has a simple interest loan can simply pay more and it'll automatically pay down principal after accrued interest (news flash this is 90% of loans). No need to call and explicit state principal only like a mortgage that isn't simple interest.
See, that’s what I did with my car note. I paid like 200.00 extra every month and ended up paying off the loan faster by like a year.
A mortgage is a simple interest loan. If you make a payment in addition to your regular payment it may or may not be applied directly to the principal (not interest deducted). ALWAYS verify your payments after you make them. This is way I always made a separate payment, it was easy verify because my balance reduced buy the exact payment amount and my next payment was not affected.
Hi, I'd like to pay towards principal as well to pay down my car loan but when I call and ask if I send 2 checks through mail (but specify one "for principal only" on the memo) will it be correctly processed as principal only they are very indirect with their answer. Can anyone suggest how I can pay toward principal? Bmo harris bank has very bad reviews on this
The process varies by lender so you have to contact them directly. I've had success by hanging up and calling again, not all CSR are created equally. If they make it to hard I would look into refinancing with lender who is not trying to get every penny possible out of you.
What happens if your principal payment is paid the same day as your reg payment??? Both are auto debited together, but clearly stated in my auto loan online account for the principal only payments and the car note.
Should be good to go! Just verify after the payment is posted.
I could have sworn in another video you said. “Don’t make an extra payment, include your principal payment in your current monthly payment” im confused now haha , which is it ?
I plan saving a $1k a month and at the 5th month. Put down $5k towards the principal every 5 months. Is it better to do $1k every month or the $5k every 5 months. Or is it the exact same thing?
Ive made so far two principle payments. When i check the car loan on the app its shows as curtailment? Is that another word for principle?
Had to google it but by definition it could be. Just make sure your balance was reduced by your payment amount meaning no interest was taken out. Isn't funny how leaders try to confuse us regular folks. SMH!
Quick ??, should I still pay $100 extra on my car note or pay the regular note, since I’m sending in extra money for the principal
Extra is always good, applying it to the principal is better!
Quick question. When should I make a principal payment? Should I make a payment on the same day and should I use the same check or issue two separate checks (one for the actual amount due and another for principal only payment)? Thanks
Looking at the big picture it really does make a difference when you make the principal payment as difference between a few days or weeks is dollars and cents. I would make two separate payments and mark one as principal only. Be sure you check with your lender to verify their process and always confirm it was applied correctly.
Diamond Edwards got it. So you’re suggesting to maybe wait a few days and then issue a separate check solely for the principal payment?
They can be on the same day but yes two checks if that is the process for you bank. Don't assume, verify.
👍
In Regards to Principal Payments how Long after Paying regular payment do you Pay the Principal Payment? Cause I've been Paying On the same Day !
What website did you go to, to get these results
www.bankrate.com/calculators/mortgages/loan-calculator.aspx
So if I make the principal payment I still have to make the regular payment too and it has to be the balance showing on the statement?? I’m new in all this I just got my car two months ago ….. thank you in advance
What you understood after I year
So I’ll be making 2 payments a month so that I can make a principal payment? I Pay online and i didn’t see anything about a principal payment.
Anything you pay over the monthly should be applied to the principal. This do not always happen which is why I like to make separate payments. Each lender is different so you have to verify with your lender on how they handle principal payments.
Oh lord... the principle payment is just an extra payment? So I still gotta pay my car note? Then, the bank called talkin about where is your payment, we can’t find it. I’m like I def just paid y’all. I’m so confused
Principal payments are to be made in addition to your regular monthly payment. Since 100% of a principal payment goes towards your balance you still have interest due for the month. The banks may be able to reclass your last payment if you call and let them know you didn't mean for it to be a principal payment.
So let's say my normal payment is 400 a month but I want to pay an additional 100 towards principle. Would I just simply add the 100 to my payment making it 500? Would that automatically go to principle?
Check with your lender to verify their policy. Do not assume and always double check that it was applied correctly. I prefer to make separate payments to the principal but again double check with your lender.
Brandon Wilson. NO! U must write "principle only" for the extra $100
100
Die to corona virus i had to ask to skip two payments i jus paid 800.00 it all went to interest what should be my next move ?
Check the details of your forbearance but my guess is they added the two payments to the end of the loan but the interest was still accruing daily so when you made your payment is went to the back interest. I would call them and have them explain it in detail.
Can I contact you ?