This article explains how to make monthly mortgage payments using ACH (Automated Clearing House) transfers, how ACH payments are applied to your loan, and what to expect when setting up recurring withdrawals.
Table of Contents
- What Is ACH?
- What Is a Monthly ACH Payment?
- How to Set Up Monthly ACH Payments
- How ACH Payments Are Applied
- Processing Times and What to Expect
- How Monthly ACH Payments Impact Your Loan
- Important Things to Confirm Before Enrolling
- Next Steps
What Is ACH?
ACH (Automated Clearing House) is an electronic bank-to-bank transfer system used to move funds between U.S. financial institutions.
- ACH payments are typically lower cost than wire transfers.
- They can be set up as recurring automatic withdrawals.
- Funds usually take 1–3 business days to process.
ACH is commonly used for recurring mortgage payments because it allows consistent monthly withdrawals without manual action.
What Is a Monthly ACH Payment?
A monthly ACH payment is an automatic withdrawal from your linked bank account that covers your required mortgage payment.
Depending on your loan setup, your ACH payment may include:
- A portion toward interest
- A portion toward principal
- Any applicable escrow or program adjustments (if applicable)
You may also have the option to add an additional principal amount to your recurring ACH payment.
How to Set Up Monthly ACH Payments
To enroll in monthly ACH payments:
- Log in to your Mortgage Dashboard.
- Navigate to the Payment Settings or Autopay section.
- Select Set Up ACH or Enable Autopay.
- Enter your bank routing number and account number.
- Choose your preferred withdrawal date (if selectable).
- Confirm and authorize the recurring ACH withdrawal.
Once confirmed, your payments will be automatically withdrawn on the scheduled date each month.
How ACH Payments Are Applied
ACH payments are applied according to your loan agreement and current billing cycle.
In most cases, funds are applied in the following order:
- Accrued interest (if applicable)
- Scheduled principal
- Additional principal (if specified)
If you include an additional amount and designate it as Principal Only, that portion will reduce your outstanding loan balance directly after processing.
Processing Times and What to Expect
- ACH withdrawals typically initiate on your scheduled payment date.
- Funds may take 1–3 business days to fully process.
- Your Mortgage Dashboard will update after funds have cleared.
- If insufficient funds are available, the payment may fail or be reversed.
If your payment date falls on a weekend or holiday, processing may occur on the next business day.
How Monthly ACH Payments Impact Your Loan
Making consistent monthly payments via ACH helps:
- Keep your loan in good standing
- Reduce your principal over time
- Support positive rate adjustments in SRM structures
- Maintain a stable repayment schedule
Because interest accrues based on your outstanding principal balance, timely and consistent payments support long-term cost efficiency.
Important Things to Confirm Before Enrolling
- Is your bank account information entered correctly?
- Does your bank allow ACH withdrawals?
- Is your scheduled withdrawal date aligned with your funding cycle?
- Do you have sufficient funds available before the withdrawal date?
If you need assistance enrolling in ACH payments or adjusting your withdrawal settings, contact support before your next scheduled payment date.
Next Steps
- Making Monthly Payments Using Cashier's or Certified Check
- Making Monthly Payments Using Bank Wire
- View Your Mortgage Dashboard