Minimum amount for additional payments to principal?

[FastbackJon]

What is the name of your state (only U.S. law)? Washington

The county recently put a sewer in my area and charged me about $5000 to do it. They spread out payments over 20 years so with interest, the balance would almost double if you include the interest paid if I stayed on their payment plan.

Monthly principal payments are amortized at about $21. They don't list that you even have a balance or what it is on the bill each month, or that anything goes to interest, so the county is sneaky in collecting money.

I called and asked if I could send in an extra payment to go towards the principal each month and they said yes, but only if the extra payment was at least $500.

Is that legal for them to deny me if I want to make a payment less than $500 to my principal balance each month?

I can't see Bank of America getting away with this if they said the minimum for additional payments to a mortgage principal had to be at least $5,000.

 

[ShyCat]

Is that legal for them to deny me if I want to make a payment less than $500 to my principal balance each month?

I'd think a taxpayer would be glad that the county doesn't spend taxpayer dollars on additional administration time and costs in handling lots of small extra payments. "Oh great, here's another $4 extra payment! Yippee! Let me open this up and enter that here... and over here... and open this other program and reduce the principal balance over there... and submit this program and wait while it recalculates this loan's amortization.... still waiting.... ah, now I'll deposit it to this other account......" Government accounting is not for the faint-hearted.

So just save up your small payments until you have $500 or more and then make your additional payment. In the meantime, you can be collecting the interest on the money as it accumulates.

 

[JETX]

Is that legal for them to deny me if I want to make a payment less than $500 to my principal balance each month?

And for a REAL answer.... How would we know what the terms of your agreement are as to early pay??
Simply, contact them in WRITING and see if you can revise the payment plan to a larger monthly minimum.