I am in the process of getting a loan and the lender has asked whether I want to set up the payments so they are auto-debited from my checking account. I've never done that before, so I would appreciate hearing what would be the pros and cons.
There are several advantages to handling payments this way. You don't have to write a check; you don't have to scrounge around for an envelope and stamp, and best of all, you know the payment will be made on time, which is important in terms of protecting your good credit. Literally, the payments are made automatically, so once you have it set up that way, it will keep functioning like clockwork every month you have a payment due. Keep in mind, however, that you will need to make sure you have enough funds in your account on the debit date to cover the payment. If you don't, you'll undoubtedly end up paying fees.
One more point. Ask the lender if arranging to pay through auto-debit will favorably affect your interest rate. In some instances, a lender will give you a better rate if you're going to pay through auto-debit because the lender knows the payments will be made on time with less hassle. It's worth asking!
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There are several advantages to handling payments this way. You don't have to write a 