Application of Extra Principal Payments

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Question:

When making an installment payment on a 2nd mortgage, can I specify that any extra payment amount, let's say $50.00, be applied to the principal and not against the next month's payment? Is the bank obligated to apply this extra amount of $50.00 against the principal if I request it to be done that way?

Answer:

Application of payments will be handled as specified in the promisory note. Read your copy to see how it's supposed to work. Your lender may be willing to accomodate a specific request for an exception, however - it doesn't hurt to ask.

First published on BankersOnline.com 1/7/02