Yamaha Motors Financing & Problems with payment towards principle

[suke]

So how the person told me is to have the Auto draft set up for the min payment. Let it draft every month, when and how much you have set up.
Then you go back on your own and "make a payment" and that is what goes towards principle. You have to do the "make a payment" on your own every month.

If you dont do it that way, any over payment amount you have goes towards the future auto draft amount.

have you been able to confirm the extra payment goes towards principle? I checked my statement and it even says any over payment goes towards principle after first paying interest and fees. The statements no longer show how the payment is split. I emailed support and asked for a copy of the breakdown to see.

 

[flyingnugget]

@suke
I have not.. I've only had the new boat for a couple of months and made 1 payment..lol. It was very frustrating and difficult talking to the rep. I'll call back tomorrow and try and get a more informed rep to help me out.

This was the only way I knew something was up.

Had the auto draft set for 20th each month. Min payment due is $531. I had auto draft set for $2000 a month to pay it off early and as quickly as possible. The auto draft wasn't showing pending this month and I was worried it wouldn't draft and have a missed payment. So I went into my Yamaha financial account and the first payment (April) of $2000 was still showing posted but May was not and it showed $124 due in Aug. I was like WTF??? So I called.

Was told only way to make extra principle payments was let the auto draft for payment due ($531) and then after it was drafted to make an extra payment of $1469 ($2000-$531) each month.

So Now I have apparently paid extra till August when the difference of $124 is due.

I did make an extra payment a couple of days ago and will check it tomorrow because I'm sure I'll have to call again.

Make sense? Sorry for the rambling on.

 

[HangOutdoors]

You all get that they cannot take interest payments before the interest is accrued in the compounding period? Not legal. Yamaha finance is one of the dumbest lenders I have ever seen next to subprime Credit One.

Basically if you pay them in a month and it is over their payment it must go to principal, they cannot take the payment for the up and coming interest periods (which is in this case a month) until it is set to accrue each month right after the statement cuts.

They can try and do whatever they want, but it is not right at all. They are going to get dinged by a lawsuit sooner or later.

It is their way of scamming additional interest and profits....

 

[suke]

You all get that they cannot take interest payments before the interest is accrued in the compounding period? Not legal. Yamaha finance is one of the dumbest lenders I have ever seen next to subprime Credit One.

Basically if you pay them in a month and it is over their payment it must go to principal, they cannot take the payment for the up and coming interest periods (which is in this case a month) until it is set to accrue each month right after the statement cuts.

They can try and do whatever they want, but it is not right at all. They are going to get dinged by a lawsuit sooner or later.

It is their way of scamming additional interest and profits....

Are we sure that's what is happening? Are they reducing the next payment to try and get that interest back? According to my statement they do put the extra towards principle....or they're supposed to. I'll when they send me a copy of my break down of payments. Mine always went to principle even if they were trying to reduce my next monthly payment.

 

[HangOutdoors]

Well it appears so by @flyingnugget post above. They took 3 months of payments in advance out of his $2k. Each payment of course is principal and interest. So they took their interest ahead of it actually being earned and due.

Wonder how many people, and I have seen other posts on this board, just go along with that? Paying payments with interest ahead of time does not help anyone but the lender. It should go to principal.

 

[2kwik4u]

Yamaha Financial is Garbage for the most part. There teaser rates get people to buy in. Their workflow, calcuations, etc. are not great.

I couldn't agree more!

Was just as bad when backed by synchrony

 

[flyingnugget]

Sweet Baby Jesus...

So just got off the phone again, yes I need a drink.

Here is what I was told (today). We can not see it on our end, but over payments have been applied to principle (apparently their Commadore 64 financial system is incapable of showing that online). But here is where it gets crazy. With "Autopay" set up, and paying more than the minimum payment as shown on your eStatement, they system will apply the over payment to principle but it also uses that portion for next month(s) payment if you miss or are unable to make it. So your over payment is doing 2 things at once lol???? WTF? That is why if y'all are paying more and look at your online account the next payment amount and due date isnt next month and/or the same payment amount on your eStatement. Clear as F'n mud.

The only way to get verification of the over amount going to principle is to call them and and ask and/or get them to send you a copy of the payment history that shows the breakdown of interest and principle and what amount went where.

The agent told me that the Autopayment function is to blame for the confusion. I had to call BS. Told him that with over payments it wont draft another amount till the balance requires it. How do I make payments each months. He said, Turn off autopay and make 2 manual payments each month.

I swear, I'm almost ready to go to my credit union, get a loan from them to pay this shit off and go with them even with a 2% higher interest rate. Pay off it as fast as possible and have the extra cost be minimal.

Hope this helps someone, anyone...LOL

Sorry to be a pain in the Azz but glad I found this thread so I can get some clarification.

 

[jthackman]

bunch of crap...my loan is not with yamaha financial...but i've had good luck using my bank's bill pay service to push payments (with extra amounts) on several loans. always applies to principal with no extra work. easy to set up auto bill pay, and easy to adjust if needed on my bank's site vs some loan co's site or csr who doesn't know things.

 

[MrBubbaGump]

Almost all places do it this way, my truck payment isn't "due" till next year.... But it still auto drafts my bank account for the amount I set it up as every month. Interest is accrued daily so if you make a larger payment it is still paying your loan down the same as if you made a minimum and "principle only" payment. The difference is they aren't showing you how much you are saving as many mortgage lenders do. In the end, if you don't ever skip a payment and continue to make additional payments it will come out the same as if you made minimum plus "principle only" payments. Unfortunately, they are sticking us with the math to figure out how quickly we are paying down the loan. Again, my truck payment says I still have almost 3 years left, but my math tells me I will have it paid off next year, since they also say I don't have a payment due till Feb 2025.

 

[flyingnugget]

@MrBubbaGump

I get where you are saying. But, the issue came to light for me was when it wouldn't auto draft again because the month prior I paid extra. I would be fine with it if it would continually auto draft, each month, the amount I had set up but it wouldn't. It would skip months and then start up again.

To me it felt like it was trying to drag the term of the loan out as long as possible.

But I get what you are saying brother.

 

[MrBubbaGump]

@flyingnugget

Copy yeah I don't do auto pay unless they give me a discount or I have to for the loan I just manually pay the boat every month. So I understand what your saying with their auto pay system.

 

[suke]

I have the auto payment setup through my bank. So, it pays the same amount every month regardless what stupid Yamaha says is "due". Also good to hear they are in fact putting it towards principle like it should.

 

[suke]

Almost all places do it this way, my truck payment isn't "due" till next year.... But it still auto drafts my bank account for the amount I set it up as every month. Interest is accrued daily so if you make a larger payment it is still paying your loan down the same as if you made a minimum and "principle only" payment. The difference is they aren't showing you how much you are saving as many mortgage lenders do. In the end, if you don't ever skip a payment and continue to make additional payments it will come out the same as if you made minimum plus "principle only" payments. Unfortunately, they are sticking us with the math to figure out how quickly we are paying down the loan. Again, my truck payment says I still have almost 3 years left, but my math tells me I will have it paid off next year, since they also say I don't have a payment due till Feb 2025.

I do the same with my truck and it also does the same thing. However, it is easier to see the principle being applied online.

 

[2kwik4u]

You all get that they cannot take interest payments before the interest is accrued in the compounding period? Not legal. Yamaha finance is one of the dumbest lenders I have ever seen next to subprime Credit One.

Is it though?

The loan is setup such that there is an amortization table, the payments are defined ahead of time, and they include an agreed amount of principle and interest. If not, the payments be different each month based on that months accrued interest. I know when I make a principal payment to other loans it doesn't recalculate my monthly obligation on the spot and adjust the remaining payments. You might take time off the term, but you're still paying the agreed monthly obligation, that includes some portion of principle and interest in each payment. A principle payment will typically only affect the term, not the monthly obligation, so the only interest you really "save" is whatever would be paid during the final payments of the loan.

This is why principle payments are typically not a really great deal (as compared to some other interest bearing account) unless you can renegotiate the monthly obligation at the same time.

 

[zpaul]

Don't ask Yamaha how much interest you paid them, they can tell you that stuff either or produce a paper that states it.
Called 4 times explaining what I need and every time they sent me total amount I paid without splitting interest or principal.

BTW Toyota did the same think when I was sending extra money, next bill will always show that I do not owe them till several months in the future.
May be they are not tightly regulated like mortgage companies and just trying to get away with sh@t like that.

 

[FSH 210 Sport]

So the best way to avoid this is to make the extra principal payments to your savings account until you have enough to pay off the boat. Then you earn a little interest too.

In my case my loan is with US bank horrible bank btw there is no place to make extra principal payments on the monthly slip. So when I do make extra principal payments I go into the branch with case and that months payment slip and request a receipt to make sure that money went to the principal.

 

[HangOutdoors]

Is it though?

The loan is setup such that there is an amortization table, the payments are defined ahead of time, and they include an agreed amount of principle and interest. If not, the payments be different each month based on that months accrued interest. I know when I make a principal payment to other loans it doesn't recalculate my monthly obligation on the spot and adjust the remaining payments. You might take time off the term, but you're still paying the agreed monthly obligation, that includes some portion of principle and interest in each payment. A principle payment will typically only affect the term, not the monthly obligation, so the only interest you really "save" is whatever would be paid during the final payments of the loan.

This is why principle payments are typically not a really great deal (as compared to some other interest bearing account) unless you can renegotiate the monthly obligation at the same time.

It is. Interest is earned on a compounding period. Can't take that ahead of time. Why not just give them all of your payments up front which would be interest and principal for the life of the loan.

 

[F.M.]

Even if they apply extra money over your regular payment toward your next payment, your principle balance is still going down. You could be 1 year ahead on payments and it all went toward your principle so your accruing less interest each month that you have the loan, and will still be on track to pay it off early. Sounds like the only problem is that if you schedule payment they Yamaha Financial, they won’t take a payment for the next month if you’re ahead on payments. So schedule the payments thru your bank at whatever interval you like, and just check your Yamaha balance occasionally and smile when you see how low it’s getting.

 

[2kwik4u]

It is. Interest is earned on a compounding period. Can't take that ahead of time. Why not just give them all of your payments up front which would be interest and principal for the life of the loan.

With that logic, you wouldn't need a loan.

OR

Why not just choose a shorter term at the start?

 

[HangOutdoors]

With that logic, you wouldn't need a loan.

OR

Why not just choose a shorter term at the start?

That is the point. Lenders shouldn't be taking payments in advance on unearned interest. Unless the interest is all front loaded.