How to pay on principal --------> NELNET

[ethan17debttackler]

I'm currently using the debt snowball method to kill my student loans. As I now focus on paying off Nelnet, my due date keeps moving forward; it's at Aug 2015 right now. If I'm not mistaken, doesn't this allow more interest to be accrued.....or is it the same as keeping current due dates while paying off principal?

Any ideas on how to "beat the system"? Thanks!

Next on target list: Mohela.....

[Cookie2120987]

I'm curious of this as well... I'll silently follow...

[ethan17debttackler]

After being in contact with them, they assure me that the only way to reduce the principal faster is just to make bigger monthly payments.

Nothing doing on due date....unless someone knows of a better way??

[smith5879]

Sounds to me like they're full of it and don't want to lose their interest from you.

Go here http://www.nelnet.com/FAQs/ and look for the question "How do I request that you process my payment using my special instructions?" There is an option to have extra money applied to the principal rather than advancing your due date.

[ethan17debttackler]

Thanks for link. They have an option to keep next month's due date (as opposed to pushing it forward), but it won't affect interest either way. Their idea of paying less interest is by paying loan while in forbearance or deferment.

I'm just going to do both: keep next due date as well as pay well beyond minimum payment.

[smith5879]

Keeping the next month's due date actually will affect how much you pay in interest. On a $10,000 loan at 5% interest over 10 years your monthly payment is $106, with $64 going toward principal and $42 toward interest. (On the very first payment at least. Over time a smaller and smaller portion of your monthly payment is applied to interest as the prinicpal decrease over time.) Say you double up one month and pay $212; $128 will have gone to principal and $84 to interest. If the date moves forward, the principal used to cacluate the interest included in the next payment will be $9872. However, if you don't move the due date $170 goes to principal and the same $42 goes toward interest. This means the principal used to calculate interest on the next payment will be $9830 instead. Keep doing this over the life of the loan and you'll pay far less in interest and the loan will be paid off much sooner. Using this scenario, about $1500 less in interest and in about 4 years instead of 10.

[Cookie2120987]

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@smith5879 wrote:

Keeping the next month's due date actually will affect how much you pay in interest. On a $10,000 loan at 5% interest over 10 years your monthly payment is $106, with $64 going toward principal and $42 toward interest. (On the very first payment at least. Over time a smaller and smaller portion of your monthly payment is applied to interest as the prinicpal decrease over time.) Say you double up one month and pay $212; $128 will have gone to principal and $84 to interest. If the date moves forward, the principal used to cacluate the interest included in the next payment will be $9872. However, if you don't move the due date $170 goes to principal and the same $42 goes toward interest. This means the principal used to calculate interest on the next payment will be $9830 instead. Keep doing this over the life of the loan and you'll pay far less in interest and the loan will be paid off much sooner. Using this scenario, about $1500 less in interest and in about 4 years instead of 10.

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I know this isn't my thread, but thank you so much for explaning this. nelnet kept telling me there was NO way to pay it off with less intrest and it was getting tiresome.

[smith5879]

No problem. Go figure, a corporation trying to separate someone from their hard earned money. I personally can't wait to have my student loans paid off so I can stop giving my money to these scummy companies.

[ethan17debttackler]

Thanks for the insight. I'm sure many of us will benefit in the long run as we pay less on interest.

[Cookie2120987]

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@ethan17debttackler wrote:
Thanks for the insight. I'm sure many of us will benefit in the long run as we pay less on interest.

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To add to this.. It seems you can ONLY do this from a physical computer. Both my IPad, and my Galaxy S4 take me to different variations of the site And neither have the option. Odd, but truthfully it doesn't surprise me with such a greedy company..