Skip Pay: Free Cash Flow With A Summertime Break From Your Loan Payment

Q: Summer puts a strain on my budget because of extra expenses! I’ve been looking for a way to get through it without racking up a huge credit card bill. I’m considering doing a Skip Pat. What do I need to know?

A: Summer expenses can bust any budget. Skip Pay will give you more breathing room during this expensive time of year. Skip Pay is a program offered to Eagle members who have made 12 months of consecutive on-time payments on any of our closed-end loans, excluding credit cards. It allows members to skip a monthly loan payment during an especially tight financial season for $50. At Eagle, members are eligible to skip up to 2 payments in a 12 month period. 

Here are some important points to consider before you decide to skip pay:

1.) Breathing room

During an expensive time of year, you might not make it through the month without resorting to swiping your credit card – and paying high interest on every purchase you make. By skipping a large bill payment, you’ll free up some cash for your daily expenses so that you don’t finish the month in the red.

2.) Longer loan term

Skipping a payment means lengthening the life of your loan. You are essentially moving this month’s payment to the end of the loan.

3.) Accrued interest

While you won’t be racking up credit card bills with high interest rates this month, you will be billed for interest on the skipped payment. You’ll need to pay that up at the end of the loan term.

Did You Know?

• Many people fall out of the habit of making their monthly payments when they choose to skip just one payment. Remember: This is a one-month-only deal! Be sure to make your payments next month.
• The popularity of skip pay plunged at the turn of the millennium. It is now offered almost exclusively by credit unions, with very few banks still offering it.
• If you feel like you could use skip pay every month, you may be in financial trouble. Speak to an Eagle representative or consult a Balance Financial Counselor for advice on money management, debt counseling and budgeting tips.

Want to hit the road without worrying about bills? Call, click or stop by Eagle today to learn about our Skip Pay program.

Your Turn: Have you ever taken advantage of Eagle's Skip Pay? Why or why not? Share your experience with us in the comments!

SOURCES:

http://blog.credit.com/2015/12/wait-some-banks-let-you-skip-payments-during-the-holidays-131160/

http://money.usnews.com/money/personal-finance/articles/2015/12/03/the-perils-of-skipping-loan-payments-this-holiday-season

https://www.servicecu.org/mobile.asp?MPID=819