Okay, I got mail from the school I attended my freshman year with the repayment schedule and other loan information. The loan was only for 750$ so my payments aren't anything extreme. I have 6 payments of 120$ to make quarterly, and the very last payment is about 70$. My first payment is due on 6/1. How should I go about doing this? I'm in the building, not rebuilding, phase and would like to know what's the best way to go about repaying this.
Is it okay if I make payments from time to time starting with my next paycheck, should I just pay quarterly(as stated on my statement), should I pay monthly instead(as suggested in other papers I received)? What I'm leaning towards doing is just paying a measly 10$ (LOL) every week and if I do that, by the time my first payment is due, I'll have paid off at least 200$ of the loan. What would be the effects of each as far as my report and score go? What should I do to maximize my scores?
Since you're building your credit, and you probably won't pay much in interest (unless you have a crazy rate on that $750), I would just make the payments as scheduled. That way, when the loan closes, you'll have some months of good payment history and a nice anchor for your average age of accounts. Good accounts stay on your report for 10 years, so this will benefit you for a while.
It's around 5%, I think in interest it's about 36 bucks. No biggie haha. And making the payments as scheduled, you mean make the quarterly payments? Because somewhere in the packet it suggests that I could also just pay the 40$ a month. But if I were to do it quarterly, (and i may just stick with that), how's the reporting going to work, are they gonna report to the bureau once every three months, which doesn't make sense to me, Or if I make a payment on time, they'll report on time payments for 3 months since each payment essentially covers 3 months worth.?
Most loans don't have a quarterly repayment schedule. This $750 amount seems like it is a loan directly through the school which you will be paying back directly to them.
Anyway. Months that you do not send a payment and you also have $0 due will still report as paid/ok. Think of it like this. Your first payment due date is Jan 1. You pay a quarterly payment amount. Your next due date will technically be April 1. You loan will be in good standing during that entire time. If you pay $10 a week starting now, when Jan 1 comes up you will probably get a loan statement saying no payment is due till May or June. If it were me, I would just stick to any repayment plan they ask for. I don't know if you are sending in checks or are repaying online through bank transfers. I have a feeling that the school is saying they will accept quarterly payments simply because it is easier and less costly to process less payments. So, they make a few cents or dollars more in the long run.