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Dwdonhoff: "If you used an amortization schedule you could see that X amount of principal, and Y amount of interest, is paid out over Z number of months. If you pay more money (it doesn't matter how the servicer explains the bookkeeping) you are shortening the remaining time on the amortization schedule. If they say you just prepaid the next 3 months, that's the same as eliminating the last 3 months (as long as you don't stop making monthly minimum payments consistently.)"

. . .

NONE OF WHICH MATTERS... as I explained, itsall a wash in the end as long as you don't fall asleep at the checkbook... and you'll eliminate it faster and safer if you aggressively save & build a side fund than attacking it directly."

I do not follow and best as I understand the OP, I do not agree.

Perhaps it is a semantic issue and I undertand amortization schedules.

Can you elaborate?

When paying ahead the pay-off total is the new month that has been paid to, plus accrued interest. More principal will be paid by a prepayment of $X that allocated only to principal versus the same $X being allocated to principal and interest that would accrue on the next Y payments.

I agree with your statement that one will eliminate it earlier in either situation, but the real question is how much total interest will be paid in both scenarios. I understand paying ahead to not reduce total interest.

Regards, JAFO
(and this is not easy to discuss without specific amortization schedule)
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