What’s the best loan payment option? It really comes down to your budget and lifestyle. We’ve broken down the differences between our payment options, and explained each method so you can decide which might work best for you.
You want to save money on your loan, or you want to pay off your loan faster
We recommend: Biweekly payments
Bi-weekly and semi-monthly payments seem very similar at first, but bi-weekly payments can help you significantly reduce interest charges compared to other payment options. Bi-weekly payments are made every other week, meaning you make 26 payments a year. Semi-monthly payments are made twice a month, so you only If you’re already making semi-monthly payments, consider switching to a bi-weekly payment instead. You probably won’t notice the two extra payments, since the extra payment will only happen two months out of the year, and you’ll be able to pay off your loan faster.
Tip: Align your loan payments with your paydays – this is especially helpful if you’re paid bi-weekly.
You need a bit more control over your budget
We recommend: Semi-monthly payments
With a semi-monthly payment option, you’ll pay the same amount towards your loan every month. A lot of people find this payment option easiest to manage, since you’ll know exactly how much you’ll be paying each month. Another benefit of semi-monthly payments is the payment size; rather than a larger monthly payment, you’ll be able to spread out your payments into smaller amounts.
If you’re the type of person who forgets to put aside enough money for bills, a semi-monthly option may be better for you. An added bonus? The regular cadence of payments may also help you create strong budgeting habits.
Multiple payment deadlines overwhelm you and you sometimes forget to pay bills
We recommend: Monthly payments
The biggest benefit of a monthly payment? It simplifies your payment schedule – you only have to worry about one payment deadline a month. A monthly payment schedule is especially helpful for a debt consolidation loan. Most people find relief when they can simplify multiple bills and deadlines into one simple payment, helping them stay on track and in control of their loan.
Semi-monthly and monthly payment options also lend themselves to a more affordable loan payment. If bi-weekly payments aren’t fitting in your budget, contact your Lending Specialist to see if adjusting your payment option can help.
Did you know you can change your payment schedule at any time during your loan?
We understand your priorities might change throughout the life of your loan – simply contact your branch if you’d like to change your payment option at any time.*
One final tip that can help with any payment option is to set up automated recurring payments. Automated payments come out of your bank account on the day you choose, so you never have to worry about late or missing loan payments. Setup recurring payments through online account management or by contacting your local branch.
Source: New feed