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I’ve been trying to pay down my car loan faster, so I’ve been making extra payments. I use my local credit union’s online bill pay which let’s me put a memo on my ‘checks’. I write that the extra payment is supposed to all go into the principal. Apparently that is not the case.

I called customer service and I was informed that I couldn’t make a payment directly towards principal.

Every payment I make goes towards the interest accrued from the last payment and the principal.  She suggested that I just put the extra money with my regular payments. I don’t want to do this for a couple reasons:

  • The extra $40-50/week (snowflake money) that I save I want to immediately put it towards the loan to make sure I don’t spend it.
  • I’m worried about the interest accruing between monthly payments.

I guess I’ll spend this weekend and see if I can find the cheapest route with this. I’ll being digging around Paid Twice to learn more about snowflaking.

Photo Credit: Rojer