I think I'm paying more interest after my due date has passed.

[wilson382]

hello guys,

l have a personal loan enrolled in auto pay from a checking account within the same bank.

lately I have noticed that, they don't charge my checking account not until 6-8 days after my due date has passed.

do you guys think that they do it on purpose to let the loan accrues extra interest in those days after the due date?

The balance on the loan is $8,348.

[gibeon]

It depends more on when the payments post to the loan rather than when the money is actually taken out of your checking account. 

If it posts to the loan account on/before the due date, then you're fine. 

I know it's odd that it takes a week to come out of your checking account at the same bank, but that's just how some are.

[wilson382]

yea, that is the problem, it's posting to the loan after the due date.
let's take last month as an example, due date is 18th of every month and payment posted to loan the on August 24th, even thought the money was sitting on the account since the 14th.

[takeshi74]

How are you determining when the payment posted to the loan?  In your OP you state that the funds aren't taken from your checking account until after the due date which is not relevant.  If your loan statements don't indicate the post date or the breakdown of the payments so you can see how much interest you're paying you can always call to verify.

[wilson382]

@takeshi74
after the due date I mean more than 4 days after due date has passed.

in my previous post I put last month statement as an example, which is August, they didn't charge my account until the 24th and that was the post date as well. I check post date by just clicking on the loan using the website or app.

[StartingOver10]

---

@wilson382 wrote:
@takeshi74
after the due date I mean more than 4 days after due date has passed.

in my previous post I put last month statement as an example, which is August, they didn't charge my account until the 24th and that was the post date as well. I check post date by just clicking on the loan using the website or app.

---

Usually you sign an authorization for the auto draft. Typically there is a date you select and a disclosure that the payment will be auto drafted within X days of the date (I have seen 5, but it could be more or less).

What date did you authorize on the signed authorization? Can you change the date?

[wilson382]

I have downloaded couple of my latest stamements and i found this to be the correct date:

08/18/15 PAYMENT ACH ELECTRONIC PAYMENT - Thank You
Applied as follows: Principal $ 131.00, Interest $ 92.65
-$223.65

[gibeon]

I would call the loan provider and make sure they are accounting for the payment being on time.

I know it is a little weird, but it doesn't really matter when the payment comes out of your checking account, or when the payment is reflected in the remaining loan balance.

All that matters is that they mark in their books (post) that they were paid on or by the correct date.

It's exactly like paying by check - they have been paid, the banks just need to move the money around in the background. Even the same thing institution takes time to shift funds from one section to another. (It takes two to three days for NFCU to process payments I make to my CCs even though my checking account is with them.)

[gibeon]

I'm glad they're accounting for it correctly. My last post was being typed when you posted yours.

This has given me flashbacks to paying for CCs and loans by physically mailing checks in envelopes and then waiting for a couple weeks until the next statement to come in the mail to see if they got the payment in time. The internet has ruined my patience.

[Revelate]

Two small things:

1) Overwhelming majority of installment loans are simple interest: the only difference the later pull and application would make would be the fractional difference in the principal by the interest rate over the intervening time... which is to say, not much.

2) It's possible your loan has the concept of a due date and late date, though I haven't the faintest idea why I've experienced one and heard of another.  My Chase mortgage works this way, due on the first, but I could've requested an automatic payment anytime between the 1st and the 15th as it wasn't "late" till the 16th.