If it's a simple intrest loan the xtra goes to principle but if it's a rule of 78's loan it don't. I bought in 03 and financed thru the dealer and was makin double payments like you and yet no reduction so found out about rule of 78's loan...if ya have find a way to refi or pay that sucker off.

 

I systematically refuse to pay a fee for paying bills online. Most companies wave the fee when you ask them politely. Be careful when you mail a payment. You have no control over when the payment is going to be applied against your loan and since they charge a daily interest rate, you will have a balance at the end of the loan although you thought it was paid off. You don't pay the balance in full? You won't get a clear title (no lean).
Don't ask me how I know.

 

Definitely call and confirm. Some companies will take your extra payment as a payment in advance. What I mean is that you had a $100 payment monthly and send two in January, they might apply that as your January and February payments rather than applying the second payment to the principal. While you'll be paying the loan off faster (2x as many payments, 1/2 the time), you won't save any money.

It's less likely now than it was in the past, however it's certainly worth checking.

 

Call the people that have your loan. That is the only way to know for sure and then I'll bet they will try and double talk you.
I hope you didn't get a loan through HD's people. I've heard nothing but bad things about them and paying off loans early.

On a different note I see your location is Colombia, South America. I just spent 10 days in in Cartagena.

 

I have paid off 2 loans with Eaglemark Savings early,no problems.
I think the new name is Harley Davidson Credit.

 

I have always bundled my bike loan into either an home equity loan or a farm loan that way the intrest is deductable and usaly a lower rate and with the farm loan I can just do a 6 month note at 6 months I pay the intrest be as agressive as I can at the principal and refinance the rest and repeat the CVO was the longest I had a loan on but I paid it off in 18 months this way.

 

I'm glad you've had no problems, I can't remember the specific details people have talked about, just that they had problems with extra fees and getting their titles in a timely manner.

I would still recommend a local bank if at all possible.

 

Check out this link http://www.pine-grove.com/reading-room/rule-of-78s.htm for a pretty good reason you should not have this in your loan agreement if you can avoid it.

The rule of 78, in my opinion, should be banned by every state in the union as it's just another opportunity for lending institutions to steal money from you.

 

As others have tried to state already it really depends on the type of loan you have...whether its an "installment loan" or a "simple interest loan". If it is an installment loan, making payments ahead of time will get you nothing.....the total interest on the loan is calculated at the loan origination and added to the principle according to the "rule of 78s" and then divided by the total number of months of the loan period to arrive at a monthly payment. If it is a simple interest loan then making extra payments or throwing a chunk of cash at the loan WILL result in less interest paid over the "life" of the loan. I went with HD Credit (Eaglemark) because they met my particular needs at the time. It is a simple interest loan and I can pay on the principle as often as I want and pay it off whenever I want with no penalties. I also make online payments via BillPay through my bank with no extra charges from HD Credit. Making two payments a month was an old "trick" espoused by financial planners for paying off MORTGAGES not installment loans.

 

This was the biggest problem I had with HD/Eaglemark. They applied a regular sized pmt same day in every case, but extra pmts took up to a week to post, even though electronic. They did back date to the PMT date though. It also took almost 6 weeks to get the title.