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What’s your time worth? Would you outsource a simple, three-minute task for $375?

Citi apparently thinks my time is that precious.  The bank recently sent me a letter in the mail offering to enroll me in its BiWeekly Advantage Plan, an automatic payment service that drafts one-half of my regular monthly mortgage payment every 14 days. The “advantage” is that I make 26 total drafts per year, equal to an additional full mortgage payment each year applied to my principal balance. I could pay off my home loan four years and four months sooner, the bank tells me. Plus, I’ll  save $34,522.34 in interest! All I need to do to enroll is pay Citi a one-time fee of $375 plus a $1.50 payment for each draft, a total amount close to $1,400.

But, hold on a gosh darn second — I can get these same results on my own without having to pay any type of fee, can’t I?

[Related Article: Watch Out for the New Fees]

While Citi doesn’t let me automatically schedule payments every two weeks, I can automatically add an extra amount to my mortgage principal each month. I used an online mortgage payoff calculator and found I just need to pay an extra $107 a month to save that same $34,522 over the life of the loan. So, why would I pay for this service? “Because the plan does the work for you,” the letter says.  ”Some homeowners may be able to achieve similar results on their own, but most aren’t able to keep up a consistent schedule.” Wow. Thanks for the vote of confidence, Citi. But even if I fail to do this automatically every month, I can still tack on an extra mortgage payment at the end of the year. Seriously, how hard is it to remember to do something once a year?

Of course, if your bank charges a prepayment penalty, this kind of deal could be a total bust. In fact, in the letter I received it says under the “terms and conditions” —in size-minuscule font — that “I understand that the terms of my mortgage may include a prepayment penalty.” My mortgage does not penalize me for an early pay-off, but it appears Citi would have sent me this offer anyway. Thanks for watching out for me, Citi! Always double-check the fine print and understand your loan’s conditions before making extra payments towards your principal.

I’m so filing this under “Desperate Bank Tricks.”

If you’re interested in seeing the full offer and terms that I received from Citi, click here.

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Image: Stargazer95050, via Flickr

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