It’s that time of year again…
It’s that time of year again…the time of year when people begin to receive offers in the mail that go like this:
Skip-a-Payment! Have extra cash for the holidays!
Yeah, right.
To me that translates to: “Skip-a-Payment! Owe more money and get deeper in debt!”
The offer I received went out to all credit union account holders, not just those with loans from the credit union. It says that you’re allowed to skip a loan payment one time in either November or December — you just have to specify which month. How generous, right?
Well, no.
I’m a curious person, so I read some of the fine print on the offer.
There’s a $30 processing fee for each loan payment that is skipped, interest continues to accrue, and it “may extend the term of your loan”.
So they’re not letting you “skip” anything; they’re just rearranging things. It also notes that, “In some cases, the amount of accrued interest may be greater than the amount of your next regular payment”.
I’m really surprised that the credit union is offering this. I’d always thought they were more likely to have their member’s best interests at heart. So it was a disappointing thing to receive.
On the plus side, I can remember when an offer like this might have appealed to me, and I’m so very grateful that it’s irrelevant to me now.
Oh, I’m so glad that I quit my mortgage collector job before the wacky season. I got so fed up with people calling to see if we would “skip” the Dec payment that I finally said this to one man:
“Sir. Christmas has been going on for about the last 2000 years, and I predict that it will go on far past the day you die. How can you be surprised that it has occurred again this year? Ok, so let’s suppose that we did allow you to “skip” a payment once a year. (Note: Without re-writing the loan. People don’t understand about maturity dates.) You have a 30-year loan, Sir. This would mean that you will have “skipped” over TWO YEARS of payments in the course of your loan. This is two and half years of extra interest that you would owe us. Now, does this make any sense to you?” His answer–“No, I guess not.”
I get these all the time, and my credit union used to send them as well when we still had an auto loan outstanding. They get shredded!
My credit union sends these all the time. With the same $30 fee.