January 26, 20179 yr I have a car loan I want to get rid of in short order but I can't pay it off in a lump sum. With that in mind, what is the best way to pay a car loan off early? Are there any pitfalls I have to watch out for or is the process straightforward?
January 26, 20179 yr I have a car loan I want to get rid of in short order but I can't pay it off in a lump sum. With that in mind, what is the best way to pay a car loan off early? Are there any pitfalls I have to watch out for or is the process straightforward? I'm sure it varies depending who the loan is through, but it's typically very straightforward and easy. One thing to look out for is that some places charge an early payoff fee.
January 26, 20179 yr Author I'm sure it varies depending who the loan is through, but it's typically very straightforward and easy. One thing to look out for is that some places charge an early payoff fee. What if I just want to pay extra each month, is there a right or wrong way to do that or does it all just depend on when the Bank gets the money and the end result is a couple of dollars here or there?
January 26, 20179 yr What if I just want to pay extra each month, is there a right or wrong way to do that or does it all just depend on when the Bank gets the money and the end result is a couple of dollars here or there? Don't think there is. Just pay what you want to pay each month. Anything over the amount due should go directly towards paying off the loan. We've been doing that with my wife's car loan since she bought it. We're at the point that her next payment isn't technically due for 7-8 months.
January 26, 20179 yr Why not just get a line of equity on the house if the rate is close? You can pay off the car loan using it. Then pay down the equity as you want and have the write off for the house?
January 26, 20179 yr Author Why not just get a line of equity on the house if the rate is close? You can pay off the car loan using it. Then pay down the equity as you want and have the write off for the house? Because I want to simplify. I paid off a Credit Card today and closed the account, of course they tried to get me to go to a "better" credit card and I got lectured like I was 2 about how important having a Credit Card is for us Americans. LOL In other words, I don't want to owe anyone anything and I have no intention of borrowing anything unless I buy a new car which doesn't look probable.
January 26, 20179 yr Because I want to simplify. I paid off a Credit Card today and closed the account, of course they tried to get me to go to a "better" credit card and I got lectured like I was 2 about how important having a Credit Card is for us Americans. LOL In other words, I don't want to owe anyone anything and I have no intention of borrowing anything unless I buy a new car which doesn't look probable. I don't think this would complicate matters. You owe $10,000 on your car. Get a $10,000 equity loan, pay off car loan. Same amount of money but tax deductible and you can pay down possibly easier than the car loan possibly.
January 26, 20179 yr Author I don't think this would complicate matters. You owe $10,000 on your car. Get a $10,000 equity loan, pay off car loan. Same amount of money but tax deductible and you can pay down possibly easier than the car loan possibly. I don't want to take out any loans, any lines of credit, and/or obtain any new credit cards. I am looking for simple.
January 26, 20179 yr What if I just want to pay extra each month, is there a right or wrong way to do that or does it all just depend on when the Bank gets the money and the end result is a couple of dollars here or there? The more money you pay a month, the less interest you will pay over time. Your interest rate probably is fairly low so you may not be talking about much savings.
January 26, 20179 yr Author I appreciate everyone's input but my level of understanding is beyond what we have been discussing. I will call my Bank.
January 26, 20179 yr I have a car loan I want to get rid of in short order but I can't pay it off in a lump sum. With that in mind, what is the best way to pay a car loan off early? Are there any pitfalls I have to watch out for or is the process straightforward? Just make early car payments.
January 26, 20179 yr I appreciate everyone's input but my level of understanding is beyond what we have been discussing. I will call my Bank. I'm not sure what more you were hoping to gather then...You pay whatever amount you want to pay when your monthly amount is due. There's nothing else to it.
January 26, 20179 yr Good call to not take the extra HELOC to pay the car....I've played this shell game and it turns out, not so effective. I take it you may be listening to some Ramsey lately ? We have been paying down on revolving and car loans and have it down to just mortgage and HELOC...no other debt. Feels a lot better, but still not finished. With my impending lack of employment, we needed to get tightened up and pile up some cash until we see what is going to happen. Always be sure to close those credit cards once paid in full...if not, they remain open on credit report and the needle on your number will not move
January 26, 20179 yr Author I'm not sure what more you were hoping to gather then...You pay whatever amount you want to pay when your monthly amount is due. There's nothing else to it. You've been helpful UK, thanks.
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