Current Events > Why do banks penalize you for paying off your student loans early?

(+) Yeah! (+)

Or putting in more than the minimum amount each month?

This is complete. Horse. Shit.

How do they penalize you?

Mine don't.

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And THIS is why you don't go to school

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Esrac posted...

How do they penalize you?

Prepayment penalty

21WIVES_CHILL posted...

Prepayment penalty

Why is that a thing?

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Bass_X0 posted...

Why is that a thing?

It's not unless you consolidate with a shitty bank.

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vigorm0rtis posted...

It's not unless you consolidate with a shitty bank.

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It's a thing for scam institutions that depend solely on people paying interest in order to make a profit, so obviously paying it off early takes away their profit.

College is a complete scam

Fuck America

Early payment penalties should be illegal, tbh.

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vigorm0rtis posted...

It's not unless you consolidate with a shitty bank.

Maybe that's why I'd never heard of such a thing.

Esrac posted...

Maybe that's why I'd never heard of such a thing.

This. This is not the norm. Most banks (and federal providers) do not charge early payment fees. Any banks that do are scamming you.

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Their way of penalizing you for avoiding the interest. They get you either way.

Its in the contract you sign to get the loan. You paying it off quicker makes them less money. its pretty simple.

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This is why you read the shit before you sign.

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Sexypwnstar posted...

This is why you read the shit before you sign.

well there is no one (except for a private transaction with a friend or family member) who is going to give you a loan without a stipulation like that. they make their money off interest. more money due = more interest.

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TheVipaGTS posted...

well there is no one (except for a private transaction with a friend or family member) who is going to give you a loan without a stipulation like that. they make their money off interest. more money due = more interest.

No.

I consolidated fresh out of college with no such stipulation.

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TheVipaGTS posted...

well there is no one (except for a private transaction with a friend or family member) who is going to give you a loan without a stipulation like that. they make their money off interest. more money due = more interest.

"no one"? Every single car loan (using like ~10 different lenders regularly) that gets signed where I work has no such penalties.
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TheVipaGTS posted...

well there is no one (except for a private transaction with a friend or family member) who is going to give you a loan without a stipulation like that. they make their money off interest. more money due = more interest.

Most decent institutions will just count on the human condition paying things back over a long period of time vs rushing to pay it off.

Interesting...

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TheVipaGTS posted...

Interesting...

Yeah. I've had several loans from different financial institutions. Not once have I ever had an early payment penalty.

The closest thing is a stipulation that any extra payments aren't applied to the amount due on the next month.

vigorm0rtis posted...

It's not unless you consolidate with a shitty bank.

So then its OP who is at fault. Sorry op

I've heard early payment fees can be a thing for like car leases, but ya. I've never heard of it being a thing for most college loans. Hell, doesn't great lakes give you like a 0.25% interest deduction just for setting up auto pay
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While I'm still not cool with my parents making me go to college, I'm glad my parents were able to pay my way through school. I'm not detailed oriented enough to pay attention to the fine print at these things and would get caught in all these tricks should I be forced to take out a loan.
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Sad_Face posted...

While I'm still not cool with my parents making me go to college, I'm glad my parents were able to pay my way through school. I'm not detailed oriented enough to pay attention to the fine print at these things and would get caught in all these tricks should I be forced to take out a loan.

@Sad_Face

Aren't you the crypto guy? What's GOOD on the crypto market for a newbie?

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Esrac posted...

Yeah. I've had several loans from different financial institutions. Not once have I ever had an early payment penalty.

The closest thing is a stipulation that any extra payments aren't applied to the amount due on the next month.

This. Every time Ive gotten any type of loan, I specifically ask if theres a pre-payment penalty. In my case, the answer has always been no.

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banks make money off of interest, so they're presumably price gouging the people that are paying ahead of time to recoup their losses

disgusting really

imo all forms of usury should be banned

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Good thing this is a joke account and nothing you post is true.

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I paid my student loans off before repayment and they didnt have any Prepayment Penalty, but from googling sounds like can happen with some mortgage loans that come attached with lower rates.


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Prepayment penalty for student loans? Wtf? Never heard of that nonsense

Sexypwnstar posted...

Aren't you the crypto guy? What's GOOD on the crypto market for a newbie?

@Sexypwnstar
Short Answer: Buy Chainlink

Long Answer: We're at the cusp of a... what you can could say is equivalent to an app store revolution, a Decentralized app (Dapp) revolution. Thanks to smart contracts, we're going to see new applications, ones that are more trustworthy or more specifically trustless. And because of this aspect, bigger promises can be made and things can be more easily monetized. For instance, there's a blockchain project headed by one of the founders of Youtube that is essentially Youtube in the blockchain space, where they can better distribute the wealth between creators and the platform via smartcontracts. The name escapes me, but their coin is called Theta so you'll find it with a Google search.

Smart contracts are basically contracts but are automated. If you say that you'll pay me X% amount if I invest in your company, you can write a smart contract that takes the profits and moves X% to me, all automated, no human interference. If I want to do a sale for crypto, I can avoid using 3rd parties (reputable site or person) or having to meet up and risk getting mugged by setting things in with a smartcontract; each of us throws money and the equivalent amount of crypto into the escrow of the smartcontract and the Smartcontract does the swap. No need for human intervention.

Ethereum is the most prominent blockchain for smart contract development. I believe in 2017, there was an ICO craze, Initial Coin Offering, where developers created tokens on the ETH platform to sell off as shares in exchange for ETH and the tokens could also be used for functionality in the project they were building. Problem was, it was essentially a Wild Wild West. Scams everywhere with no regulations and of the legitimate projects, they didn't amount to much. Why? If ETH is analogous to a decentralized computer, and Dapps are analogous to apps (I mean, they are), what good is a computer if it can't connect to the internet? This is what stopped ETH, stopped smartcontracts, from ruling the world. This is where Chainlink comes in.

Blockchains are built around security from the ground up. Because of this, you can't just send data to the blockchain, it needs to verified that it's tamper-free honest data, else it's the weakest link and the single point of failure. The entity that does this called an oracle. Chainlink aims to solve that issue by decentralizing that aspect, where you incentivize multiple oracles node operators to deliver data from the source to the blockchain.

There are a number of projects out there that I'm keeping my eye on, Fantom is a project that aims to make a smart city and apparently has partnerships with Dubai and the Afghan government. I'm not at all confident in that project since they're trying to usurp Ethereum's community and I see no reason to move your development from ETH to FTM. Then there are stablecoins like MakerDAO or Reserve Rights, coins that are aiming to be a world reserve currency to hedge your wealth with if you're in a country with an inflating currency (think Venezuela and Argentina), though I haven't done enough research on and subsequently haven't put much of any money into. But at the heart of all these projects is Chainlink. Like a computer or phone or gaming console or smart appliance or whatever, it has limited functionality if it can't connect to the outside world. It needs the internet to reach its full potential. The Chainlink network is the defacto oracle

Even if you're not at all convinced of the project, I tell everyone to throw $20 or any insignificant amount to make sure you have something. This has the potential to be the greatest investment of all time. The bitcoin was the greatest investment of all time, as the price went from less to a cent to $20K and the bitcoin network handles billions of dollars of transactions without ever breaking down. But thanks to the antics in the crypto world, the reputation of everything regarding crypto is met with "It's a scam". Mind you, big companies, from Google to Facebook AND governments are investing heavily into the technology of blockchain. As the spinoff technology, smart contracts, will usher the largest wealth transfer (and possible wealth creation) of mankind. This is why you constantly hear Andrew Yang harp on about the Fourth Industrial Revolution and UBI, there literally won't be enough jobs thanks to automation.

This is a completely new and rising industry so you have to take the time to learn the technologies, and you have to have foresight as to where the world is going to go. None of that "I need to see it to believe" bullshit. You need to believe it yourself before others see it so you can buy at a lower price. That's the whole point of investing. I'll drop a number of links that you have to sit down and put time into to get started.

Blockchain tech in general
https://www.youtube.com/watch?v=Pl8OlkkwRpc

The potential of smartcontracts
https://blog.chain.link/44-ways-to-enhance-your-smart-contract-with-chainlink/

Chainlink's comparison to HTTP
https://blog.chain.link/interoperability-and-connectivity-unlocking-smart-contracts-3-0-2/

Chainlink community growth comparison to the WWW
https://enclaveresearch.com/comments-on-the-chainlink-white-paper-parallels-to-early-web/

Other miscellaneous info
chainlinkhub.com

Remember, understanding is key to all this. Once you understand what smartcontracts can do for you. Once you recognize the value of Chainlink. Then you'll be able to answer the question "If you were to split the internet as we know it now into a billion tokens, how much would one token be worth?" That's how much one Chainlink token will eventually cost and more.

You can do all this, or just go on Coinbase.com and do free crypto videos for $10 and trade to Link.

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Nice I'm at work atm but I'll look that over when I get home

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