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Hyundai can't do maths

Eric2203

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For those of you who finance through Hyundai Finance and pay extra every month (or even if you don't), are you seeing issues with how they calculate the remaining balance?

Allow me to explain further: we're financing part of our Palisade (rest was a big down-payment). The part that we're financing is over 5y @ 1.9%, the standard rate offered by Hyundai. As any good debtor should, I pay more than the required monthly amount every month, in order to pay the car off early and minimize the interest. This is where it starts going wrong.

They apply the extra money to next month's payment, rather than the principal. I know Hyundai isn't alone in doing this, but it's not what I want. The whole point of putting extra money against the principal is to lower the interest. I'm not trying to buy myself a buffer of a few months here. I have to call them in order to have them apply the extra $ to the principal. There's apparently no way to specify that I never want the extra $ to go towards next month's payment. I have called them to do that with the first 2 payments, and was told I only need to call every 3 months, because they can do that retroactively for the last 3 payments. So I waited another 3 payments and called again. And this is when I noticed that things are way worse than I thought.

Please do me a favor and log in to your account. Then under Payments, go to Payment History. It will give you a table with details of your payments, how much goes towards interest, how much goes towards principal, and the remaining balance. Check that remaining balance column. For me, it's all over the place. The remaining balance does not decrease by the amount that is applied to the principal every month. It decreases less. It's not even logical from month to month (normally, you pay a little less towards interest and little more towards principal every month). Mine looks like no pattern that I can establish. What does yours look like?

Paying extra $ every month seems to only make things worse. I can see where they applied the extra $ to my principal the first 2 times I've called (and not the last 3 payments). And it correctly reset my monthly payment to be the full amount the first 2 times. But now, all of sudden, they seem to think I've paid enough extra that my March payment isn't necessary anymore.

First, that's incorrect, because if they have correctly put the extra $ from my first 2 payments towards my principal, I can't have paid enough extra $ to earn a free month yet. But I did the maths, and adding the extra $ from my first 2 payments to the last 3 does add up to more than enough $ to get me a free month. So much for applying that extra $ towards my principal!

Second, instead of listing my next due date as April and skipping March, they skip two months and tell me my next due date is in May! I have paid enough extra $ for a free month, but not 2! This is nuts.

Iv'e tried calling them several times. Twice, I was told they would look into it (and that they had just updated their system and had issues). Twice nothing was done. Today, I tried calling for the third time and I get a message to expect longer wait times because of COVID-19. Fine, but then it hangs up on me. I'm not going to blame anyone for not being at work at the moment, although it would be nice to have a recording stating that, rather than hanging up on people.

I've had about enough of them. I'm interested in hearing whether I'm alone in this.
 

Alan_F

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I don't think very many people who finance a car, put down a big down payment AND then make larger than required monthly payments. It's possible that their computer systems are just not prepared for that unlikely situation. I know that is done on home mortgages, but probably pretty rare on car financing.

Maybe you should have put down a bigger down payment if you knew you wanted to pay off the loan faster. Or, invest the money you are using for extra payment amounts (instead of sending it to Hyundai) and then at some point in the future use that money to pay off the entire loan early.
 

Eric2203

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I don't think very many people who finance a car, put down a big down payment AND then make larger than required monthly payments. It's possible that their computer systems are just not prepared for that unlikely situation. I know that is done on home mortgages, but probably pretty rare on car financing.

Maybe you should have put down a bigger down payment if you knew you wanted to pay off the loan faster. Or, invest the money you are using for extra payment amounts (instead of sending it to Hyundai) and then at some point in the future use that money to pay off the entire loan early.
I know plenty of people who finance a car (or some of it) and pay extra every month.

If I could have made a bigger down-payment or buy the car outright, I would have done so - odd suggestion to make.

Investing the extra money instead of paying it isn't worth the hassle considering the relatively low amounts we're talking about here. It also lowers the interest I'll pay on the loan overall, which pretty much cancels out gains I would get from investing that extra monthly amount.
 

SADIE2020

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Eric...I agree with you totally. That is exactly my plan as I pay my loan. I hope they fix this issue ASAP!!! More people do this than you know. Assuming differently is pretty arrogant in my opinion.
 

Eric2203

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Of all the problem the world is facing right now, this is pretty low on the list.
I never claimed otherwise. My monthly payment happened to be due and I've been battling this issue with Hyundai Finance for a while. So I figured I'd post, particularly since I'm at home, like everyone else, thanks to COVID-19, and have a little more time to do so.

Not sure what the point of your comment was. Should we refrain from talking about anything else until this virus is eradicated?
 

Eric2203

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Eric...I agree with you totally. That is exactly my plan as I pay my loan. I hope they fix this issue ASAP!!! More people do this than you know. Assuming differently is pretty arrogant in my opinion.
Exactly. It's a common thing to do, not to mention the correct way to handle a loan.
 

tallLeRoy

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I have done the extra payment thing many times. Not this time though, paid with trade and cash. I can see why lenders would do it Hyundai's way, it gives them a bit more interest over the life of the loan than if they applied the extra to the principle.
 

Alan_F

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I never claimed otherwise. My monthly payment happened to be due and I've been battling this issue with Hyundai Finance for a while. So I figured I'd post, particularly since I'm at home, like everyone else, thanks to COVID-19, and have a little more time to do so.

Not sure what the point of your comment was. Should we refrain from talking about anything else until this virus is eradicated?
I think you over-reacted, instead of just informing others. Just my opinion.

Next time you can buy another brand of automobile, or have it financed somewhere besides Hyundai Finance.
 

Alan_F

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I have done the extra payment thing many times. Not this time though, paid with trade and cash. I can see why lenders would do it Hyundai's way, it gives them a bit more interest over the life of the loan than if they applied the extra to the principle.
There is also the possibility that their systems are not set up to do this automatically, and it is not part of their business model that some live person at Hyundai Finance would need to apply the extra money manually against the principal every time someone wants to do that.
 

Eric2203

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I have done the extra payment thing many times. Not this time though, paid with trade and cash. I can see why lenders would do it Hyundai's way, it gives them a bit more interest over the life of the loan than if they applied the extra to the principle.
Oh I totally get why they're doing it. And to a certain extent, it's fine as long as I can choose to apply my extra $ to the principal rather than next month's payment. It worked fine at the beginning, or I'd have raised the issue sooner. But now, they're not doing what I'm requesting, AND the balance calculations are wrong. The latter is the real problem.

I think you over-reacted, instead of just informing others. Just my opinion.

Next time you can buy another brand of automobile, or have it financed somewhere besides Hyundai Finance.
What are you talking about? I posted to ask if others are in the same situation. Not to inform people.

Where's the overreaction? The end of my original post literally states that "I'm not going to blame anyone for not being at work at the moment".

And FYI, I've been trying to solve this for 3 weeks now, not just yesterday. Not that it's any of your business.

I don't go posting on forums as soon as I have issues, as some others do. I do try to resolve things and/or look for answers by myself first. That should be painfully obvious from my post history on the various Palisade forums.

Tone down your judging of others, please. I thought I was guilty of that myself, but man... you take the cake.

There is also the possibility that their systems are not set up to do this automatically, and it is not part of their business model that some live person at Hyundai Finance would need to apply the extra money manually against the principal every time someone wants to do that.
They are not set up to do that automatically. I do have to call for them to do it the way I want. They have done so successfully for my first 2 payments and do have a process for that, as they've told me repeatedly. It's just broken right now.

Asked and answered already.
 

Alan_F

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They are not set up to do that automatically. I do have to call for them to do it the way I want. They have done so successfully for my first 2 payments.

Asked and answered already.
Case closed. If I were them I would refuse to do it manually also (unless you pay a $25 fee each time). The low interest rates they charge are not possible if they have to process payments manually on a recurring basis. Seems like they are willing to do it if you want to pay down a big chunk of the loan, but not do that every month.
 

SADIE2020

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Case closed. If I were them I would refuse to do it manually also (unless you pay a $25 fee each time). The low interest rates they charge are not possible if they have to process payments manually on a recurring basis. Seems like they are willing to do it if you want to pay down a big chunk of the loan, but not do that every month.
Apparently you don't understand finances. You do your things your way Alan and we will do it our way. No need to be a jerk about it.
 

Alan_F

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I have done the extra payment thing many times. Not this time though, paid with trade and cash. I can see why lenders would do it Hyundai's way, it gives them a bit more interest over the life of the loan than if they applied the extra to the principle.
Mortgage companies are set up for borrowers to do that, but not sure about auto loans. I would bet that not many Hyundai buyers do it on their car loans.
 
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SADIE2020

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What a coincidence that you joined this forum today just for this thread. Do you know the thread starter?
No I don't. Just purchased my Palisade last week. So joined to talk with like minded individuals. Sorry not sorry, this doesn't meet with your expectations.
 

Alan_F

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Apparently you don't understand finances. You do your things your way Alan and we will do it our way. No need to be a jerk about it.
Well since I am a CPA, I do understand finances. One thing I do know is that finance companies are not set up to handle transactions manually, and if they had to do them manually they would have to charge extra fees or higher interest rates to hire extra people to handle that work.

I guess you are admitting that you know the original thread starter and joined this forum to support Eric, and I notice that your forum name is SADIE2020 and the original thread starter is Eric2203, a strikingly similar format.
 

SADIE2020

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I have done the extra payment thing many times. Not this time though, paid with trade and cash. I can see why lenders would do it Hyundai's way, it gives them a bit more interest over the life of the loan than if they applied the extra to the principle.
I would normally agree with you. But, when they are selling at MSRP which is waaaaay over cost to make it.....they are making money. There is no penalty for prepay. So you can make extra principal payments. You can also do that to any loans you take out without pre payment penalties.
 

SADIE2020

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Well since I am a CPA, I do understand finances. One thing I do know is that finance companies are not set up to handle transactions manually, and if they had to do them manually they would have to charge extra fees or higher interest rates to hire extra people to handle that work.

I guess you are admitting that you know the original thread starter and joined this forum to support Eric, and I notice that your forum name is SADIE2020 and the original thread starter is Eric2203, a strikingly similar format.
No...I don't know the person. So coincidence. Sadie is the name of my car and I purchased in 2020. So you are wrong on your assumptions. But you know what they say about assuming.
 
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