Successful PenFed SSL Loan

[Patient957]

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@Snook_on_the_Line wrote:

Did the $2900 you paid then become available in your share account to transfer out, or is it tied up for the life of the loan?

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Yes, it became available immediately to transfer out, which I did.

[Patient957]

@Snook_on_the_Line 

It only tied up my $3150 for the 30 days it has to be in the share account before opening the loan (due to PenFed's rule).  You get all the money back after that 30 days.

Otherwise, the only cost of the SSL is the 2.05% interest I will pay on the $250 balance over the ~12 years of the loan, which will be about $40-60 total over 12 years, depending on how much I pay each month, if any.

It's not a free 31 points, but it's cheap. 

[FicoMike0]

I was going to do the $2/month to pay mine off, but I've read about penfed forgiving the last $50 or so on loans. That would pay it off early, ending the score boost.

[masscredit]

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@FicoMike0 wrote:

I was going to do the $2/month to pay mine off, but I've read about penfed forgiving the last $50 or so on loans. That would pay it off early, ending the score boost.

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Is that an "it can happen" thing or "it does happen"? I deposited $1500 last week. Plan on paying the loan to $120 (8%). Don't want to loose a couple years 

[Patient957]

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@FicoMike0 wrote:

I was going to do the $2/month to pay mine off, but I've read about penfed forgiving the last $50 or so on loans. That would pay it off early, ending the score boost.

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Yeah, I reduced mine to $1 per month for the same reason.  

I might open an identical SSL at some point around the 8 yr mark, so there's always one open well before the other closes.  But it's hard to plan that far ahead.  I don't see myself taking out any "real" installment loan in the future.  If I can't pay for it, I probably don't need it.  A mortgage, maybe, we'll see.

[Patient957]

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@masscredit wrote:

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@FicoMike0 wrote:

I was going to do the $2/month to pay mine off, but I've read about penfed forgiving the last $50 or so on loans. That would pay it off early, ending the score boost.

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Is that an "it can happen" thing or "it does happen"? I deposited $1500 last week. Plan on paying the loan to $120 (8%). Don't want to loose a couple years 

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We've seen a few recent reports of it happening, but I don't think we have any confirmation that it's a new policy such that we could say it will happen for sure. 

So for now it's "it can happen."  You could ask the phone rep, but honesty, I would not trust what they say.

It's kind of funny.  PenFed is giving out free money and we're here worried about it, not wanting it. 

[Snook_on_the_Line]

Yea I'm thinking about going for a shorter term with higher payments.    

maybe 60months @ $50/mo

Then if I paid down to 8% in month one there would be $237 remaining with the next payment due in 55 months.    

im pretty sure their system isn't going to want to eat over $200

[FicoMike0]

First, it's a crazy loan anyway, borrowing your own money. It's even crazier that you get a score boost from maintaining the loan at < 9%. Now we hear that penfed sometimes forgives the last $50 or so. Normally, we'd celebrate that. 

Right now, my loan shows the next payment due in 8/2030, balance $189, payment $26. If I don't pay until the due date, I'll owe 7 payments and I'll hit about a $50 balance with two payments to go. That's ok, I don't mind reducing my 84 month loan to 82 months. On the other hand, if I pay $2.xx a month, I'll hit a $50 balance with $50/2.xx =~ 24 months to go, reducing my 84 month loan to 60 months. Not so good.

Why make any payment before 2030? My concern is that without activity, the loan may stop reporting. So, now I'm thinking maybe pay $2 every year on new years day. Probably over thinking it.

[FicoMike0]

Looking at my numbers closer, I probably want to pay about $4 a year. Since I paid my loan to exactly 9%, the balance is creeping above 9%. The 2.05% interest on $189 is ~ $0.32 a month. If I make payments of $4 a year, that will keep the balance under $189.

[Snook_on_the_Line]

@FicoMike0 

Is it possible to set up an automatic payment for just the intrest.   

in your case, $.32 per month 

and also can you schedule payments to resume at $25/ month on schedule