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Discussion Starter · #1 ·
Is the only way to make a principal payment on the tC (if financed through toyota), to write them out a check and put "Principal Payment" in the memo? I was wondering if I could write that in the memo of an electronic payment via my bank online and have it apply that way. Has anyone done this?
 

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Discussion Starter · #3 ·
I sent Toyota their money this month, so if I send them another payment before my next bill comes, it goes right toward the principal eh? I think I'll wait and call their 800# in the morning. I just wana make sure
 

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Yes, there is a way to pay off your principle... Here's what you have to do:

1.) Write the check out to Toyota Financial Services.

2.) On the check, make sure to write out your account # and "Apply to Principle Balance"

3.) Do not send th check to your normal payment address... To pay the principle, it's a different address. Here it is;

Toyota Financial Services
Attn: Principle Processing
P.O. Box 22202
Owings Mills, MD 22117-1397

If you send an extra check, it will only go toward your next payment, for example, if your payment is $300. You write a check for $300 and then write another for $300, it wont go towards your principle, it goes toward your next months payment (as in, you wont owe anything the next mont) get it?
 

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Originally posted by coolhandluke@Aug 25 2005, 10:09 PM
If you send an extra check, it will only go toward your next payment, for example, if your payment is $300. You write a check for $300 and then write another for $300, it wont go towards your principle, it goes toward your next months payment (as in, you wont owe anything the next mont) get it?
I agree. I paid off my Avalon which was financed through Toyota Financing early this year. The monthly payment was about $519 but I wrote down $520 each month.

When I got the next bill, it's always a dollar less, so, the extra $1 just went toward the next month payment, not the principle.
 

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Anything extra you include in each check goes towards the principal. TFS (and any other financing institution) will show your amount due smaller next month, then it will skip a month as far as due date goes, but if you keep paying on your normal due date, it still goes to your principal, and you will still end up saving some money on the interest and will pay the loan off earlier. TFS obviously does not want to encourage people to pay the loan off earlier, so they play these mindtricks hoping people will keep the loan as long as possible.
 

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Discussion Starter · #8 ·
Originally posted by coolhandluke@Aug 26 2005, 01:09 AM
Yes, there is a way to pay off your principle... Here's what you have to do:

1.) Write the check out to Toyota Financial Services.

2.) On the check, make sure to write out your account # and "Apply to Principle Balance"

3.) Do not send th check to your normal payment address... To pay the principle, it's a different address. Here it is;

Toyota Financial Services
Attn: Principle Processing
P.O. Box 22202
Owings Mills, MD 22117-1397

If you send an extra check, it will only go toward your next payment, for example, if your payment is $300. You write a check for $300 and then write another for $300, it wont go towards your principle, it goes toward your next months payment (as in, you wont owe anything the next mont) get it?
Ok, Thanks!

I'll try sending them a check and then check my real balance with TFS online and make sure the principal went down. It's not that I want a lower monthly payment, it's that I want a shorter loan term
 

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There's no need to send anything anywhere else unless you are concerned about what the statement says. I ignore the statement and just pay more than what they want. The "extra" automatically pays down the principle, and the monthly required payment goes down on the statement.

If you can't figure out how to make stable montly payments for more than the stated payment amount, then go ahead, but it's really just an accounting thing for you. It makes no difference to how the money is applied to the loan.
 

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Discussion Starter · #10 ·
I figured if you paid say $400 towards a $350/month bill, the extra $50 is applied towards the interest, which is what Toyota really wants. But you're saying that the $50 would go straight towards the principal?
 

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When you pay more than what is due on a loan -- i.e., when you pay some amount that is greater than the amount of accrued (earned) interest at that point -- the excess will go to principal, because it has nowhere else to go.

If that doesn't make sense, let me clarify something -- when you take out a loan and sign a periodic payment contract for that loan, the monthly payment amount they come up with includes the amount of interest due at that time, plus however much principal needs to be paid off in that particular month to have the loan come out to whatever term you agreed to (e.g., 60 months, 48 months, or whatever). Sure, you'll owe more interest in the future, but it hasn't accrued yet, so they're not entitled to it yet -- and any extra money you pay right then will go to principal.
 

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Simple interest loan:

Take principle, multiply by the daily interest rate and the number of days since the last payment. This is the interest due. Make a payment. Pay the interest due first, then apply the rest of the payment to the principle. So after the interest is paid, EVERYTHING goes toward the principle. A day, a week, a month, or a year later, the same process will be applied to the next payment received.
 

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I think it all depends on the financial institute. My old place if i wanted to send extra money towards my car i would include it all in the check and they would automatically apply it to the principal, now with this new company i have Not TFS they will credit my account for the next month that i know of. If i was going to send them extra money i would include a seperate check at the time of making my payment and put in the memo "TOWARDS PRINCIPAL" so that way i know for sure they credit it.

I honestly already had a problem with them, they claimed i accepted this stupid "SKIP A PAYMENT PLAN" which i never did, it was kidna funny they were like WE RECIEVED THE FORM...i was like REALLY I HAVE IT IN MY HAND..they were like OH, WELL SOMEONE MUST HAVE CREDITED YOUR ACCOUNT BY MISTAKE, I was like YEAH THEY MUST HAVE. It was a big thing..but it all got taken care of. But it now has me wondering will they apply my car payment to someone elses account? HA!
 

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What you said does not make sense. Could you please edit it and assume we know nothing about this situation. Punctuation in the right places would help immensely. I seriously want to understand what you are saying about TFS because I am also a customer and I don't want them jacking my stuff up either.
 

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What he is saying lance, is that the extra money that he would pay is being just "held" in limbo until his next payment is due, and they say they are charging him for the same interest on whatever his principal is at the time, and applying his "held" extra money toward that payment as a whole. They arent applying it at the time (essentially saying he is prepaying his next month). Which in my mind is quite retarded as it provides no benefit to the customer whatsoever to pay for 2 months upfront rather than just save that money and pay when its due.

Wobbit I would certainly be pretty pushy to get them to automatically apply any extra payment toward your principal, and make sure you read over your loan paperwork to make sure there are no sort of "skip" clauses or early payment penalties or anything.
 

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Be aware that it is very likely that TFS or any other finance company has no obligation to do anything with an additional payment other than credit it towards your next payment and not require you to pay again until the payment after that is due. Anyone who is concerned about this should read his or her finance contract carefully, because this is the only way to know the real answer to this question.
 
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