An overpayment is a payment amount that is greater than the current amount due. CDM supports two common ways to handle extra funds: applying them to future payments or applying them only to principal.
When a new regular payment allocates more toward interest and principal than the amount required for the due date shown, CDM asks how the extra amount should be applied.
Choose Apply to Future Payments when the extra amount should advance the payment schedule or reduce upcoming due amounts.
Choose Apply to Principal Only when the extra amount should reduce principal without advancing the due date.
Use Apply to Future Payments when the payer is paying ahead.
CDM uses the extra scheduled-payment amount to move the next payment due date forward or reduce the next amount due. If the overage covers one or more full scheduled periods, CDM advances the due date accordingly.
Use Apply to Principal Only when the payer wants the extra amount to reduce principal without changing when the next scheduled payment is due.
CDM limits the payment schedule update to the current amount due and applies the extra principal as principal reduction.
Payment links can be generated for a fixed amount. CDM previews the due amount, outstanding fees, and overpayment amount before the link is generated.
If the fixed amount is greater than the calculated amount due, CDM requires staff to choose an overpayment handling option:
CDM will not generate or post an overpayment link until this decision is made.
CDM prevents payments from exceeding the currently allocatable loan balance.
For final payments, extra funds cannot be placed into fee, interest, or principal allocation buckets beyond what is owed. Final-payment overpayments must be handled as a payoff exception where the total payment exceeds the allocated payoff amount.