Why is it when I send an ELECTRONIC payment from Citibank to Sallie Mae does it take as long as sending a physical check to them if not longer. Isn’t the whole point of electronic payments is that it clears faster? Something does not smell right here…..
I sent me electronic payment on 10/24 as well as Citibank sending them a physical check on the 23rd. Both payments cleared on the 28th. This is like the story of the tortoise and the hair except they finish at the same time. As of 10/30 neither payment has posted to my account.
Why oh why would it take so long?
Here is my theory …. They calculate the interest that you are paying on your outstanding principal on a daily basis and if you are sending a payment that will lower your outstanding principal that would mean less money on subsequent interest calculations. While my principal would only have dropped 85$ for the last couple of days that they were calculating interest I can’t figure out what this translates to but I am guessing a couple of cents a day right? But let’s think about that.. A few cents extra per payment (variable because allot of people have way bigger loans than I do) * per "customer" * number of months the loan is active. As you can see this could be a big number of "free" money.
While looking into the impact of the money that should have come off my principal I found this Accrued Interest Calculator utility on the Sallie Mae Website witch I had not seen before. It is under the customer support > Calculators > Interest Accrual Calculator. Currently mine is at $7.07 per day so I would have to do the differential whenever they decide to finally apply my payment.
(now 5 days since payment has cleared my bank)
(now 6 days and have been placed in the cursed auto dialer from hell)
Checked payment history and the 10$ physical check has posted to my loan beating the ELECTRONIC payment that was sent 1 day later.
(now on the 7th day it posts)
However they back dated this to October 27th (before it cleared my bank) like nothing ever happened. How can I keep track of these loans when they just change dates?
How did this impact me? well what about the dollar amount that was supposed to be applied to principal? did they base the payment to principal off of the 11/4 date or did they go back and apply it to the amount that was outstanding as of 10/27 that date they are now claiming the payment was applied to my loan?
Either way the 86$ that was applied to my loan reduced my daily interest from 7.07 to 7.06 so for those 6 days that they sat on my payment for no good reason logic would say that they at least pocketed .06 cents on top of what the the larger payment to principal would have lowered the daily interest….
I found a press release that says Sallie Mae has 10,000,000 customers so a potential .06 cent “mistake” per customer in a month = 600,000$ or 7.2 million a year. I don’t know.. it is so hard to keep track of what they are doing you seriously have to take screenshots of every page every day because they just change dates and numbers.