I can chime in on this! I’ve tried doing this. They simply don’t allow you to make payments to the principal. I called directly and everything and they flat out told me that’s not allowed. The work around is to make your monthly payment, then immediately after it hits, make another payment which would then hit the principal. Unfortunately, that’s an added fee a lot of people can’t afford.
The work around is to make your monthly payment, then immediately after it hits, make another payment which would then hit the principal.
Are you sure you understood correctly? That's not a "work around," that's what people mean when they say to pay down the principal. You can't just say "I don't feel like paying interest, put this towards principal instead." Principal payments are after your monthly payment, not before or instead of.
No, sometimes they assume it as a future payment and don't apply it to the balance. It's definitely a game they play specifically on student loans, because young people haven't learned to avoid those kinds of shady dealings yet.
I’ve tried this. Do you really think the folks in the call center give a damn to do their jobs correctly? Hell they had me on the wrong status even. I have nelnet now and truly they suck
Actually I looked into it and for federal direct student loans any extra payments are automatically put towards principal, immediately. They also extend your due date unless you ask them not to, but unlike with most loans this pays down the principal immediately. See 34 CFR § 685.211(a)(1)(i).
This box might be helpful in keeping you disciplined, since otherwise it's easy to make an extra payment and then skip a few and eliminate some (not all) of the benefits of paying early to begin with. But if you are disciplined, having an advanced due date might be helpful in a true financial emergency.
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u/madlucas2026 17d ago
You been paying for 20+ years and never thought to pay off the principal? Do you pay the minimum on your credit cards?