I have not been successfully able to get a clarifying answer from my mortgage company on this issue, so I was wondering if anyone here knew.

If I am overpaying my mortgage, by let's say $100 per payment. Is there any difference in principal reduction and interest applied between them ACH withdrawing that money vs me mailing in a check, i.e. sending it from my own online banking?

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    I think the only one who can answer this question correctly is your mortgage company. If they can't answer, you probably spoke to the wrong person. – TTT Jan 30 '17 at 15:26
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    FYI, some mortgages impose penalties if you overpay by a certain amount. Usually it's 10%, but it varies so much sure you know what the rate is for your loan. – Nosrac Jan 30 '17 at 15:39

Unfortunately there is no universal answer to this question. Each mortgage servicing company will handle it differently according to their own policies. The best way to handle this problem is to talk to your mortgage servicing company and specify that you want all of your over-payments to be applied to principle (assuming that is indeed what you want).

Most companies will be willing to work according to your stated preferences, but there may be some companies that have a specific procedure for how to make sure that preference is applied. Unfortunately there is very little you can do about it if you ended up with one of the less friendly mortgage servicing companies out there. Maybe threaten a lawsuit. Good luck.

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  • Thanks for the answer, at least I know the right thing to ask for. I didn't realise that was something you could do. – Moby's Stunt Double Jan 30 '17 at 15:29

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