[Beware, the following post contains wonky student-loan-speak!]
One of the first things I did with my student loans was to set up auto-billing. I already auto-pay all of my utilities to avoid the monthly nuisance of needing to either remember my log in info so I can pay online, or locating my checkbook and stamps in order to mail off a payment in time, so adding loan payments to the pile was a no-brainer. But many lenders incentivize auto-billing even further by offering a slight reduction in interest rates. The term “miniscule” might be more accurate than “slight reduction,” since the reduction is generally along the order of 0.25% – but hey, I’ll take it.
My student loan servicers are Navient (formerly Sallie Mae) and ACS. Navient deducts mid-month, around the 11th, while ACS deducts at the end, in order for the payment to be applied by the 1st of the month deadline. I checked my bank account at the end of last week (on the 16th) and saw that my Navient payment had gone through on 1/11, but there was nothing from ACS at the end of December. Worried that I had somehow de-activated my auto-debit, I logged into the site. Luckily, that wasn’t the case. My Billing Type is clearly listed (in all-caps) as “AUTO DEBIT.”
I submitted a large $1000 payment on 12/11, and that was the last time that ACS had received a payment from me; i.e. they hadn’t gotten a payment in over 30 days. My next thought was, “Oh great, do I owe a late fee?” Wrong on that account, too. There was a note on my homepage indicating Pay Off Good Through: January 31, 2015. ACS has a handy little glossary to explain those kinds of phrases, and they define Payoff Good Through as
The date by which the payoff amount displayed must be processed to your account before additional interest accrues. When making a payoff payment, please allow 10 business days for mail and processing time.
The payoff itself is “the total amount due to pay your account in full,” or my remaining loan balance. My next due date is listed as February 1, 2015, but the amount due is a grand total of $0. The amount due each month is principal + interest, so I suppose that there won’t be any new interest until after January 31. Basically, the loan servicer is rolling over my next payment until I’ve accrued additional interest. How… thoughtful.
This experience has been a good lesson in understanding the sneakiness of loan servicers. I’m sure their rebuttal would be that they want to protect me from an overdraft should I unsuccessfully attempt to make two payments within 30 days (a one-time payment followed by an auto-debit withdrawal), and there’s some validity to that. But I’m being deliberate about those extra payments, not careless. It’s irritating that my proactivity isn’t rewarding me to the extent that I thought it would.
ACS’s Automatic Bill Payment program is calculated and set without input from the person making the payments, so I don’t have the option to set my monthly withdrawal amount. Since, as far as I can tell, I can’t edit my current $63.64 charge and am not inclined to set up a bill payer service, I’ve just set bi-monthly calendar reminders through the end of the year to log into ACS. That way, if I’m feeling up for making an extra payment, I can, and I’ll get a reminder a couple of weeks later to submit my regular payment as well.
Does anybody out there have loans being paid back through ACS and has figured out a way to raise their monthly auto-debit amount? (I suppose a phone call to their office may shed more light on all this, as well.)