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Conseco - Principal Repayment

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Evelyn of DeBary FL (6/29/03):
I don't understand how they do their "simple interest" calculations. No matter if I'm on time or not...very little, mostly nothing, ever gets applied to my principal. I call and ask them and they say it's because it's a "simple interest loan". So what? That means it'll never get paid off? I just don't understand their answers.

In the early years of the loan, all of the payments go to the interest. In later years, the principal finally starts to go down. Unfortunately, mobile homes often don't retain their value long enough for this to do any good. Evelyn should begin making additional principal payments.

Tony of Hughesville PA (6/8/03):
We purchased a mobile home in January 2001. It was $15,900 and we put $3,500 down. Over the last two years I have made all payments on time -- 27 payments @ $350.00 each. I called Conseco for a payoff and they tell me it is $12,800. How they figure is beyond me. I have paid over $13,000 in two years. My rate is 16 3/4%.

Tony has forgotten to calculate the cost of the interest on his loan and he has not taken into account the fact that payments in the first years of a loan go largely to pay off interest. The principal finally gets paid off in the last years. This is true of nearly all mortgages.

Dewayne of Brookhaven MS (4/2/02)::
Since Greentree has switched to Conseco we have had trouble. With Greentree we would always pay additional principal and it would go to our principal. Now we pay additional principal and they will tag it to the interest. They said they would get their interest up front. Now instead of the hassle I just pay by phone extra so now they prorate my bill and it is always less each month.

In March of last year we owned more on the home than what we financed. That is the one question i want answered.

The total amount of a mortgage (including principal and interest over the life of the loan) is always more than the purchase price. This is why lengthy mortgages on mobile homes are not a good idea -- the home depreciates faster than the interest is paid off.

Donna of Dallas City IL (5/22/03):
My 88-year-old mother bought a mobile home from Sentry Mobile home. It was financed by Greentree. Unfortunately the mobile home company went out of business so we have had nobody to complain to about the junk trailer. The first winter the furnace broke down. The air conditioner has broke down. The drawers have all broken. The stripping on the paneling is buckling. The electrical outlets malfunction. It's a real junk trailer for the price she is having to pay for it.

The biggest complaint is that Conseco is taking the payment money as interest and little is paid on the principal. Who do we complain to about a faulty trailer?

If the seller went out of business, Donna basically has no one to complain to. The mortgage company is not responsible for the condition of the trailer.

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