New Auto Loan Question

[GOOFY4DONALD]

We just bought a new for us (2009) truck and before we even need to make the first payment I am already thinking of ways to get it paid off faster. I am just not sure how to go about doing it. Some months I will be able to add anywhere from 100.00 to double the monthly payment. It has been so long since we had a car payment and back then we were not in any position to pay things off early. Here is my question... Can I only pay extra when I add it on to the regular payment? or Can I pay the extra amount at any time after the regular payment is paid?

Example... payment is due on 1st of month @ 500.00 can I pay that and then pay 100.00 on the 15th of the month. or do I just wait until the 1st of the next month and pay 600.00?

I know this seems like a stupid question but the last car we financed was paid off in 2003.
TIA

 

[wmharley]

We just bought a new for us (2009) truck and before we even need to make the first payment I am already thinking of ways to get it paid off faster. I am just not sure how to go about doing it. Some months I will be able to add anywhere from 100.00 to double the monthly payment. It has been so long since we had a car payment and back then we were not in any position to pay things off early. Here is my question... Can I only pay extra when I add it on to the regular payment? or Can I pay the extra amount at any time after the regular payment is paid?

Example... payment is due on 1st of month @ 500.00 can I pay that and then pay 100.00 on the 15th of the month. or do I just wait until the 1st of the next month and pay 600.00?

I know this seems like a stupid question but the last car we financed was paid off in 2003.
TIA

on my loan I can pay extra, but it gets credited to the next months' bill. But at one point, I was 2 months ahead (will use one month cushion to fix my water softener).

So yes you can..

 

[ceecee]

When I was younger and didn't know any better, I had a crazy loan and when I paid it off early they still charged me interest.

 

[Kitzka]

You may want to check the fine print on your car loan. Some loans will still charge you the interest if you pay early or there is a penalty for paying early.

We ahve had 2 car loans in our lives. The first had no penalty and we were able to pay it off about 3 months early. the 2nd there was a penalty so we didn't pay it early.

lara

 

[GOOFY4DONALD]

Thanks for the replies. I just pulled out the contract we do not have to pay a minimum finance charge if we pay it off early.

 

[bumbershoot]

Thanks for the replies. I just pulled out the contract we do not have to pay a minimum finance charge if we pay it off early.

Very cool.

Our car loan is through Chase, and although I've been very unhappy with the loan because of the usury we were charged (can't even call it "interest" it's so high IMO), once we pulled our heads out of the sand and started paying it off early,I've been VERY happy with their terms.

Nowadays I just go into a branch, pull out one of their loan payment forms, mark "principal payment", and give them whatever I'm giving them. Might be 50 cents in rolled coin, might be $600 extra (I was paying extra with each online payment, and although it *looked* like it was doing everything right, I was actually just paying ahead, and I ended up nearly 6 months ahead of payments, so for half of those months we've just done big principal payments b/c nothing has actually been due). It's easy.


So if you have Chase, you're in luck! If not, at least you know the terms of your specific loan.

 

[minnie1928]

Thanks for the replies. I just pulled out the contract we do not have to pay a minimum finance charge if we pay it off early.

I would make your extra payment as a separate payment and make sure it is processed as a "principal only" payment. Some places may process extra payments as a payment in advance...meaning that they are crediting your account towards your next payment to cover both principal and interest. That's not what you are looking to do, you are looking to reduce your principal so less interest accrues. You can make principal payments any time, they are completely unrelated to your regular car payment.

 

[GOOFY4DONALD]

Thanks. The auto loan is through wells fargo. We did not go into the bank to get the auto loan it was just the lender that offered the best interest rates. I am not sure if I would be able to go into a regular branch and pay it. I guess I will wait and see.

 

[bumbershoot]

That's how we got our loan as well. Chase wasn't even out here when we got it. It's been the one good thing about losing WaMu, that now we're crawling with Chase branches. I was just paying online until I asked at the branch if I could pay it there.

So definitely ask if Wells Fargo does the same thing!