FAQs

If I send a payment that's more than my monthly mortgage payment, how will Pennymac apply the funds?

Unless you provide specific instructions, payments that exceed your monthly amount are applied in the following standard order:

  1. Outstanding Payments: Funds are first used to bring your loan current (if past due) and pay the current month.
  2. Prepayment: If the remaining funds are sufficient to cover a full monthly payment, they will be applied to the next month’s payment.
  3. Fees & Principal: Any remaining funds are then applied in this sequence:
    1. Late charges
    2. Additional fees
    3. Corporate advances
    4. Principal reduction (this is where extra money helps pay down your loan)

How to Designate Your Payment If you want extra funds applied differently (for example, “Principal Only”), you must include a note with your payment instructions.

Important Note for Bill Pay Users: If you use your bank's online Bill Pay service, we do not receive the notes or memos you type. To ensure extra funds are applied to principal, please make your payment through your Pennymac online account or by phone.