CU*Answers Librarian

<div id="library_content"> <a name="top"></a> <h1>Answers to Your Mortgage Payment Questions</h1> Your credit union makes it easy to make your monthly mortgage payment. Whether you want to mail us a check every month, use our handy phone or internet banking services, or set up an automated transfer so you don't have to think about it at all, we've got lots of choices! <a name="index"></a><h2>In this document</h2> <ul> <li><a href="#make_payments">How can I make payments on my credit union mortgage?</a></li> <li><a href="#each_or_every_other_week">What if I want to pay a little bit each week or every other week toward my mortgage payment?</a></li> <li><a href="#mortgage_savings_account">Who should use a mortgage savings account to handle mortgage payments?</a></li> <li><a href="#automatic_payment">Are there automatic payment options?</a></li> <li><a href="#pay_ahead">Can I pay ahead?</a></li> <li><a href="#more_than_one_payment">Can I make more than one payment a month?</a></li> <li><a href="#extra_payments">Can I make extra payments directly to principal?</a></li> <li><a href="#bi_weekly">What about bi-weekly mortgage payments?</a></li> </ul> <a href="#index" style="float:right">Index</a> <a name="make_payments"></a> <h2>How can I make payments on my credit union mortgage?</h2> There are several convenient ways you can make your mortgage payment. Remember that whichever method you choose, you must make a full payment, including the escrow amount (if any), every month. <blockquote> Come in to any branch and make a deposit, or ask a teller to transfer funds from one of your savings or checking accounts or Call our phone center and ask a Member Service Representative to make a transfer from a savings or checking account to pay on your mortgage or Use CU*TALK audio response to transfer funds from a savings or checking account to your mortgage loan or Log on to CU*@HOME internet home banking and transfer funds from a savings or checking account to your mortgage loan or Schedule payments from your checking account using the CU*EasyPay! bill payment service or Mail us a check (make sure to plan ahead so the check arrives by your due date) or Take advantage of the credit union's automated payment options (described below). </blockquote> <a name="each_or_every_other_week"></a> <a href="#index" style="float:right">Index</a> <h2>What if I want to pay a little bit each week or every other week toward my mortgage payment?</h2> If you receive a weekly, bi-weekly, or bi-monthly paycheck, you can request a portion of your mortgage payment amount to be set aside in a special mortgage savings account. Then, once a month, the full mortgage payment will be transferred automatically to the mortgage loan. Contact a credit union Member Service Representative for more information. <a name="mortgage_savings_account"></a> <a href="#index" style="float:right">Index</a> <h2>Who should use a mortgage savings account to handle mortgage payments?</h2> You should use a mortgage savings account with automated transfers if you... <blockquote> ...want to pay little bits toward your mortgage payment at various times during the month. ...get paid more than one a month. ...do not get paid the same amount in every paycheck. ...receive income from multiple sources, or on an irregular schedule. ...do not want to have to remember to mail a check to pay your mortgage. ...don't want to use audio response or home banking. ...can't make it to a branch office. ...want to simplify your life! </blockquote> <a name="automatic_payment"></a> <a href="#index" style="float:right">Index</a> <h2>Are there automatic payment options?</h2> Yes! A credit union Member Service Representative can you help you set up an automated payment program...so there's one less thing on your mind! Here are some options: <blockquote> Set up a special mortgage savings account that holds funds for your monthly mortgage payment. You can make "payments" into this savings account any time you wish throughout the month. For example, you could set up a portion of your weekly paycheck to go automatically into this savings account, or make a transfer via internet banking at any time during the month, or deposit some money at a branch...any method you wish! An automated transfer is then set up to move the payment amount from that special savings account to your mortgage loan in time for your due date. or If you always keep a balance in one of your savings or checking accounts, you can set up an automated transfer that will pull your mortgage payment out of that account and transfer it to the loan, once every month in time to meet your due date. All you haveto do is make sure the full payment amount is in the account every month in time for the transfer. or If you receive a monthly paycheck that is deposited directly into your account (either via ACH or from your company's payroll department directly to the credit union), set up an automatic distribution out of the paycheck to pay on your mortgage. (If you get paid more than once each month, you'll need to use the separate mortgage savings account to set aside a portion of each paycheck to make up your monthly payment.) </blockquote> Did you know...? You can set up automated transfers yourself using CU*@HOME internet banking. After logging in, click Personal Preferences, then Automatic Funds Transfers. (This link also appears on the page where you make regular transfers.) If this link does not appear, contact the credit union directly for assistance! <a name="pay_ahead"></a> <a href="#index" style="float:right">Index</a> <h2>Can I pay ahead?</h2> As a rule, mortgage loans are set up to receive a single payment, once every month. Because of the way interest is calculated on these special types of loans, payments for a particular month cannot be accepted until after the 20th of the previous month. For example, your June mortgage payment can be made on May 22, but not on May 19. But let's say you are going on a trip and want to make sure your next mortgage payment isn't missed. Here are a few options to consider: <blockquote> Contact the credit union about setting up a one-time automated transfer from a savings account, then deposit the payment amount into that account (make sure you don't withdraw it accidentally!) or After the 20th of the month, use our convenient audio response or internet banking services to make the transfer from one of your savings accounts to your mortgage loan or Contact the credit union to arrange for us to hold your payment until after the 20th. </blockquote> Better yet, ask us about setting up automated transfers so that your mortgage is paid automatically, on time, every month using funds from a designated savings account. <a name="more_than_one_payment"></a> <a href="#index" style="float:right">Index</a> <h2>Can I make more than one payment a month?</h2> As mentioned before, mortgages are designed to receive one payment a month, every month. You can make extra payments toward principal, but you cannot make multiple, smaller payments directly to the mortgage loan within the same month. If you want to be able to pay a little bit each week, or at various times throughout the month, you will need to set up a special mortgage savings account to receive the funds, then an automated transfer will make the single mortgage payment each month using funds from that account. <a name="extra_payments"></a> <a href="#index" style="float:right">Index</a> <h2>Can I make extra payments directly to principal?</h2> Yes. You'll need to let us know that you want the payment applied to principal, so please use one of the following methods to make the extra payment: <blockquote> Mail a check, attaching a note that specifies that the entire payment should be applied to principal or Stop in at a branch location and ask the teller to apply a deposit or a transfer directly to principal </blockquote> In order to avoid problems with your regular payments, we ask that you do not use electronic methods such as audio response, home banking, payroll deduction, or the like to make extra principal payments on your mortgage loan. <a name="bi_weekly"></a> <a href="#index" style="float:right">Index</a> <h2>What about bi-weekly mortgage payments?</h2> You've probably heard the buzz about companies that offer special "bi-weekly mortgage reduction services" or "bi-weekly savings programs" to save you money on mortgage interest. Look a little deeper, and it turns out all they are doing is taking bi-weekly deductions from your savings account to go toward your monthly payments. (Over the course of a year, this results in one extra full payment being made.) And of course they charge a hefty servicing fee! You can do this yourself at no cost by simply taking advantage of the credit union's automated payment options already described, or by simply making one extra payment each year, applied directly to your loan's principal. </div>

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