I just received a letter from my bank , stating that my yearly rollover interest rate would not be changing. As of now we pay $353.72 on the principal and 61.63 on the interest. This loan is almost 18 years old and we owe $25,800.
The letter states that our interest rate will remain at 5%, but the payment on the principal will change to 306.02 and the interest will go up to $109.60. As I said the interest rate did not change.
This makes no sense to me and when I contacted the bank, they were not able to give me a good reason why this is happening. They want me to send a copy of the letter I received and give the some time to look at our loan papers. Has anyone ever heard of this?