I’ve basically retired from real estate doing only referrals when past clients and customers call. When they do, I put them in touch with Heidi Perreira of Lava Rock Realty (808-987-8299). She’s in the thick of it every day, knows what’s going on, is honest and will work in your best interests. Consequently I haven’t written much here and what I am doing is very different.
I’m fighting for our liberty. This is what I feel is more important than anything else right now. I have another blog: GetOffYourButts.net. Check it out and if you like it bookmark it and share it unless of course, you like the way the country is heading.
But what compels me today is a disturbing experience I had with CitiMortgage. I’ve refinanced recently to an interest only loan. I like the ability to make principal payments on my own when I have managed to stash a little cash.
With an interest only loan, the payments are considerably lower than they would be with a fully amortized 30-year loan, like $204.51/mo in my case. Actually it would be more of a savings because the rates on the 30 year amortized loans are never as low as an interest only loan.
An extra $205 a month applied yourself in extra principal payments adds up a lot faster, but YOU DO HAVE TO HAVE THE DISAPLINE TO DO IT! Obviously there are lots of considerations for doing an interest only loan, but it is worth exploration.
But back to my point, the Citi Run-around did not refer to running errands but to the vilgilence required to make sure your payments are applied as intended. They first told me that my payments would remain the same each month even after extra principal payments. So not true! Another beauty of the interest only loan is that your payment is automatically lowered on your next payment. Neverless, I had to insist on a chat with her supervisor to get this straightened out.
Then to add insult to injury I noticed after a couple of extra prinicipal payments that they were taking interest out and only applying the remainder of my check amount to principal. This is when I had no regular payment due and I sent the extra principal payment on a coupon they provided me specifically for that purpose! The words “principal only pmt” were highlighted on the memo line of my check. Go figure how can they be so, well yes, dumb??
I got the ole “computer” excuse, but was fianlly able to get it on the right track. So my advise to you if you have an interest only loan is to monitor it regularly and call them right away if it doesn’t look right.