I made a big snowflake payment to my Lending Club loan this month and while it hurt to see that money go out of my ING account it felt good to bring down the balance on a loan.
I currently have $306 as the payoff amount on the Lending Club loan, which I am hoping to pay off in March.
After I make that payment I will be free of the Lending Club loan and can roll that money into the snowball for a different debt target.
For those of you who who don’t know, I got the loan with Lending Club as a way to consolidate some high credit card balances. I had two credit cards with interest rates hovering around 19% and 21% so it made sense for me to try to consolidate that debt into a lower interest loan.
I got a loan for 8.9% with Lending Club in March 2008, for three years and my payments were set at $189.77 per month. I have been targeting the Lending Club loan and paying off more than the minimum every month so that I could reduce the amount of interest that I owe.
I just logged into the account and realized that by paying off the payoff amount in March, I will have paid off the full loan amount in one year, instead of the three that was the allocated time. The people who lent me money are very happy to see the money coming in because it means two major things:
* I was a good loan (no default)
* The early repayment means they can fund other loans
On the flip side of that is that I was a ‘bad’ loan customer because I paid off the loan early and this means they got less interest payments from me.
Here is a snapshot of my loan account information as of the last payment I made
|Next Payment: $189.77|
|Due Date: Mar 06, 2009|
|Overdue Amount: $0.00|
|Sum of remaining payments: $763.45|
|Pay-off Amount: $305.42|
|Amount paid to date: $6,068.16 (794.84%)|
There are no penalities for early repayment so it makes good financial sense for me to pay off the loan early. As you can see the total amount I will pay if I continue to pay the minimum payment will be $763.45. If I can make the sacrifice and make a bulk payment in March then I will save $458.03.
Please check in with me and pray and cross your fingers that nothing bad happens and I can pay off the balance of this loan in March!!!!!