paying off specific loans?

Anonymous · ‎02-11-2015

I have paid off all interest for my Great Lakes loans, and I was wondering how I can now apply payments to specific loans. Would I have to tell Great lakes which specific loans to apply my payments?

SCF · ‎02-11-2015

Yes, if you want to apply extra payments (over the minimum due, with no interest or fees due on any of your loans) to a specific loan you have to tell your lender how to apply it. If you don't they will split it among all of your loans evenly. Some servicers have the ability to do this through their website. With others you have to make a payment over the phone or by mail in order to give them specific instructions.

Anonymous · ‎02-25-2015

I'm tackling all my 6.8% loans first. I have three of them: $1300, $2000, and $800. According to common sense, I should pay off the $800 loan first followed by the $1300 then finally the $2000 loan, right?

SCF · ‎02-25-2015

It depends on what "common sense" you're using. Paying off the highest interest rate loans first will save you the most over time. If it feels better to pay off the smaller loans first, and that helps keep you motivated, then it's a great strategy.

Anonymous · ‎02-25-2015

@SCF wrote:
It depends on what "common sense" you're using. Paying off the highest interest rate loans first will save you the most over time. If it feels better to pay off the smaller loans first, and that helps keep you motivated, then it's a great strategy.

Thanks for all your knowledge, SCF!!

bradlin · ‎02-28-2015

@Anonymous wrote:
I'm tackling all my 6.8% loans first. I have three of them: $1300, $2000, and $800. According to common sense, I should pay off the $800 loan first followed by the $1300 then finally the $2000 loan, right?

Yeah pretty much. That way you close them out faster. But others will say doing it the opposite way will yield a slightly longer AAoA.

Anonymous · ‎02-28-2015

@bradlin wrote:
@Anonymous wrote:
I'm tackling all my 6.8% loans first. I have three of them: $1300, $2000, and $800. According to common sense, I should pay off the $800 loan first followed by the $1300 then finally the $2000 loan, right?
Yeah pretty much. That way you close them out faster. But others will say doing it the opposite way will yield a slightly longer AAoA.

Thanks for confirming my method, bradlin Thank you

Anonymous · ‎03-22-2015

@SCF wrote:
It depends on what "common sense" you're using. Paying off the highest interest rate loans first will save you the most over time. If it feels better to pay off the smaller loans first, and that helps keep you motivated, then it's a great strategy.

Excellent advice!

Anonymous · ‎03-22-2015

@Anonymous wrote:
I'm tackling all my 6.8% loans first. I have three of them: $1300, $2000, and $800. According to common sense, I should pay off the $800 loan first followed by the $1300 then finally the $2000 loan, right?

Mathematically, it's better to pay off the loans with higher interest rates first. However, if paying off the smaller loans will keep you motivated than do it instead. Then apply Dave Ramsey's Snowball effect to help you pay down your other loans faster. Good luck!!!