Frequently Asked Questions

Question Why should I make extra payments against my auto loan?

Answer Automobile owners in the U.S. have been “programmed” to accept the tradition of paying an auto loan over 5 to 6 years, and in the process, becoming “upside down” or having negative equity. The effect of one extra payment a year can reduce the amount of interest paid on the loan, accelerate the loan’s payoff, and accelerate the equity.

Question How does this reduce the amount of interest paid and accelerate the payoff of my loan?

Answer The key is a change from paying monthly to having a half payment debited every two weeks. When 26 half payments are debited each year, two extra half debits occur semi-annually. These “extra” debits are forwarded to your lender as “principal only” payments. Interest paid is based on the current principal balance, so the interest paid is consistently reduced and the loan payoff is accelerated.

Question How does the SmartNote biweekly debiting program work?

Answer On the biweekly schedule, you will be debited every two weeks on a predetermined day of the week (Example: Fridays). With the biweekly debit schedule, you are debited approximately 26 times per calendar year. Each debit will equal one-half of your standard monthly payment plus a convenience fee. This results in you making an extra monthly payment each year. There may be more than 26 payments in one year based on how the calendar falls or adjustments you may make to your debiting schedule. By utilizing the SmartNote biweekly debiting program for the life of the loan, a customer will pay down the principal balance at a faster rate than under a traditional monthly payment method. Actual results depend on factors including initial loan balance, monthly payments, and interest rate.

Question Can’t I make the extra payments myself?

Answer Yes! However, people usually lack the time, consistency, and/or the desire to schedule and make extra payments. When you have a half debit automatically withdrawn from your account every two weeks by SmartNote, we provide the consistency and discipline to accelerate your payoff.

Question Is there a way to increase the acceleration and pay off my auto loan even sooner?

Answer Yes! It’s as simple as increasing the amount of biweekly debits under the SmartNote biweekly debiting program. Additional funds are earmarked as principal payments and are added to the regular semi-annual principal payment, further reducing the loan balance and speeding up an already accelerated loan payoff.

Question Is SmartNote my lender?

Answer No. SmartNote is a money services business. We electronically debit your account and make payments to your lender on your behalf. You just let us know of the schedule that works best with your paydays or budget, set up a debiting schedule, and we take care of the rest.

Question How often is a payment sent to my lender?

Answer SmartNote sends a payment to your lender once a month. We do not send a partial payment after each debit. Most lenders will not accept or correctly post a partial payment. The benefits obtained from the SmartNote biweekly debiting program are from the extra half payments that are sent to your lender each year.

Question I just received a coupon book or statement from my lender. What should I do with it?

Answer First review the information and compare it to the Program Snapshot on your Welcome Letter to verify that all of the loan terms and lender information are correct.

If you have not provided SmartNote with your loan number please contact SmartNote and do so now!

In most instances SmartNote will make the first payment to your lender. If you have elected to make one or more payments directly to your lender you will need to refer to the coupon or statement for instructions on how to make a payment. If SmartNote is making the 1st payment due on your loan, and you have verified we have the correct loan information and your loan number, just file the information received from your lender away for your personal use as needed.

Question Can I stop, change, or move a debit?

Answer Yes. As long as you contact SmartNote no later than noon CST the business day prior to your debit. Please keep in mind that we cannot stop, transmit, or process a debit or payment on a banking holiday.

Due to peak call times, we recommend that you not wait until the last minute to call. Please see our hours of operation and holiday closures.

Question Do I need to contact SmartNote if I refinance, payoff, have a total loss, or receive changes to my loan?

Answer Yes. You have contracted SmartNote to service your loan throughout its term. It is your responsibility and extremely important for you to notify SmartNote promptly with any changes to your loan. Your lender does not provide any information directly to us.

Question When will my enrollment fee be charged?

Answer In most instances, SmartNote’s enrollment fee is deferred and will be collected within the first year from your extra debits. If you cancel within the first year, you may still owe a portion of your deferred enrollment fee. See our disclosure of fees and refund policy.

Question Why doesn’t my lender offer this?

Answer We can only speculate, however there are several possible reasons:

  1. They lose interest dollars.
  2. They are not equipped to handle biweekly debiting.
  3. Developing new system programming to handle biweekly debits could be cost prohibitive.