Charles S
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Definitely tell the bank that the extra money in your payment is to be put toward the principle, but before you pay it off early, look into early payment fees. Some auto loans have an early payment fee that will cover most if not all or more than the interest that they are going to lose. |
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happy2beme60
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tell the folks you have your loan with when you make a large payment you want it going towards the principle balance that will lessen your intrest charges |
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XoxoxoxoX
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If your auto loan is CURRENT, other than paying your monthly payment next month, you can put rest of the balance (from the $7,000) toward your principles. You just need to call your auto loan company to find out how to go about it. Not sure the part that you mention the interest owe over 6 years? Are those past dues? Or you simply meant the interest accrued on the term of the loan. |
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BOYBOY
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Well depends- but you didn't give all the information to calculate how much. SO heres the link to the payment calculator. You can also add extra payments on the bottom half of the calculator to see how much faster you can pay off the loan and how much total interest you will be paying not making extra payments and with extra payments.
http://www.bankrate.com/brm/auto-loan-calculator.asp
Loan Amz. will show how much your monthly payments will be affected. But to answer your question, you won't see a huge difference in total interest pay- for me I would be saving 350 off of interest paid by making extra 100 bucks on a 3 year loan. Total loan is around 9000. What you will see is you will pay off the loan early which is great! good luck |
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Jeffrey T
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I was told if you are going to do this make 2 payments not 1.
Make your normal monthly payment and then make a 2nd payment with the words principle only on the check.
So if your normal payment is $300 make that payment and make a 2nd payment of $6700 marked principle only. This way the entire $6700 comes off the principle. I would advise you check with yout loan company to make sure this is right. I have never done it, but that is what I was told. |
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mcmoehring@sbcglobal.net
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Take the amount you owe x the interest rate divided my 12 will provide the monthly interest owed.
Let's say you owe $20K and you rate is 6%
$20000 x .06 = 1200 / 12 = $100 per month interest
if you pay the $7K
$13000 X .06 = 780 / 12 = $65 per month interest
Instead of making a very large payment every few months make a large payment every month. This will keep the interest lower and lower every month.
You're the man for paying off quickly. |
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tornticket
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Caution! There are car loans that do pay down interest first before the principal is paid. They can actually pay the entire loans interest first before any principal is paid. They are legal loans in most states but it must be stated in the loan documents. Read your loan documents or find a reliable bank loan officer, maybe at your own bank, to read the documents and advise you. Don't send any extra payment until you absolutely know for sure. There is no going back. |
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Evil Homer
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On most loans, the interest is posted monthly based on the balance owed. When/if you make a large payment, the principal balance is reduced and thereby the amount of the interest that they post will be based on the lower principal. |
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Holly W
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All but the amount due will go to principle if your loan is simple interest. |
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Curtis R
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first check your contract, talk to the lender, i did the same thing and was 1 year ahead on payments miss one payment and they repo the car, sold it at for 800.00 its value was 22,000.00 |
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