Tip for Dealing with Companies When Finally Paying Off Something

[MineralMan]

It has happened to everyone. You paid off a credit card, a car loan, a cable TV bill or some other amount due. Your intent was to make one last final payment.

Then, the next month, you get another bill for a small amount. You pay that, too, but those bills keep coming. I found a foolproof solution that can avoid this from occurring, along with another tip you might find handy.

If you get small bills after paying something off, don't send payment in that amount. Instead, pay $5 or $10 more than the amount. Things like interest on credit card bills accrues daily, so the total on your final bill is not what you actually owe. It is what you owed the day the bill was created. Overpay, and that nonsense will end. Most often, your overpayment will be returned as a refund check.

Along the same lines, you can handle this another way. When paying off a credit card, a cable bill, car loan, or whatever other bill is likely to cause this small balance problem, call customer service and ask for the final payoff amount if paid today. Then, pay then and there, using a debit or credit card. You'll get no more of those nuisance bills.

That is what title and escrow companies do when paying off mortgages when a home is sold. They get the final payoff amount on the closing date, directly from the lender, and wire the funds directly to the lender. You can do the same thing with pesky consumer companies, utilities, and other places that post daily charges. Call, ask, and pay on the spot.

[a kennedy]

1. Thank you for this info.....will be printing it out and keeping it handy.

[stopdiggin]

2. thanks. that is useful

both strategies work well ((over pay by a small amount, and pay by phone) -- and both are going to create a lot less stress than getting that 'final-final' (following the 'final payment'-) bill in the mail. That has everybody tearing out clumps of hair!

[wryter2000]

3. My car loan

My car loan offered me the final pay-off amount online through the regular payment site. In fact, it was a few cents less than the last payment amount because I was paying a bit early. No subsequent bills. This was Ally, which used to be GMAC.

[BobTheSubgenius]

4. Good advice.

Those stupid little interest charges could hypothetically go on until the end of the decade. It's essentially a source of free money to the "lender;" they have little incentive to close the account.

[MineralMan]

5. Their accounting systems cannot deal with overpayments.

over payments. To balance the books, they MUST issue a refund. That's the trick that works.