Pay off car or not?

[Mackenzie Click-Mickelson]

As long as you are comfortable with diverting the funds from the "home" account to the car payment I would pay off the car loan..or at least maybe half. Only thing I get worried about is having enough money in an account for those unexpected things. Paying interest though sucks so you'd have to weigh that with taking money out of that account.

 

[redsonja76]

Pay it off!!!!

 

[LJSquishy]

I have never seen a 13% interest rate on a car loan...if you are really paying 13%, pay it off immediately. If you mean 1.3% then you'll want to weigh your options. It's good to have money set aside for emergencies but if you can pay off your vehicle loan and still have 3+ months of your salary in savings, I would do that.

 

[usnuzuloose]

I would pay it off and put the money I was paying into the savings account. Then that debt is gone.

 

[dmc6469]

I have never seen a 13% interest rate on a car loan...if you are really paying 13%, pay it off immediately. If you mean 1.3% then you'll want to weigh your options. It's good to have money set aside for emergencies but if you can pay off your vehicle loan and still have 3+ months of your salary in savings, I would do that.

Yes, seriously 13.75% to be exact!

 

[dmc6469]

Alright, I did it! Paid off the car. Apparently, it was coming to $18.79 interest a day. When I looked at that, I said do it now! Not tomorrow and waste another $20! So all done. No more debt (ok, except the house but that’s life…monthly payments until I die) LOL

 

[Tikitoi]

How do you figure out how much interest you are paying per month?

My original loan amount for my car was $15079.00; the Interest is at 2.29%; for a 6 year loan.

I may want to pay mine off as well...

 

[runwad]

13.75% Yowza glad you paid it off!!

 

[VillainFavs]

Alright, I did it! Paid off the car. Apparently, it was coming to $18.79 interest a day. When I looked at that, I said do it now! Not tomorrow and waste another $20! So all done. No more debt (ok, except the house but that’s life…monthly payments until I die) LOL

I'm almost afraid to ask, but what kind of rate do you have on your house? And who did you go through that they were charging 13% on an auto loan? That's just so beyond comparison to anything out there! If you signed on to a 13% auto loan that should have really been more like 3%, do you need to look at other things as well?

 

[pittsburghmom]

Yes, seriously 13.75% to be exact!

Happy to hear you paid it Off! Yikes!

 

[wonderlandwego]

Alright, I did it! Paid off the car. Apparently, it was coming to $18.79 interest a day. When I looked at that, I said do it now! Not tomorrow and waste another $20! So all done. No more debt (ok, except the house but that’s life…monthly payments until I die) LOL

Smart Decision!!!!

 

[georgina]

How do you figure out how much interest you are paying per month?

My original loan amount for my car was $15079.00; the Interest is at 2.29%; for a 6 year loan.

I may want to pay mine off as well...

Are you paying about $224.35 a month? I plugged your numbers into an online loan calculator, and got this -

Beginning Balance Interest Principal Ending Balance
1 $15,079.00 $320.52 $2,371.68 $12,707.35
2 $12,707.35 $265.64 $2,426.56 $10,280.82
3 $10,280.82 $209.48 $2,482.72 $7,798.13
4 $7,798.13 $152.03 $2,540.17 $5,257.99
5 $5,257.99 $93.23 $2,598.97 $2,659.07
6 $2,659.07 $33.10 $2,659.10 $0.00

Hard to read through the bad formatting, but the first year you pay $320.52 in interest, the second $265.64, etc, that column shows interest paid each year, which decreases yearly.

 

[Marionnette]

Yes, seriously 13.75% to be exact!

I have credit cards with lower APRs. That's outrageous! Good thing that you paid it off!

 

[ellie05]

13%.

At 13% I would pay it off right away! We just bought a new car our interest is so low it made more sense to leave that money in a short term investment that pay us 5% since our car loan is less than 2%.

 

[Tikitoi]

Are you paying about $224.35 a month? I plugged your numbers into an online loan calculator, and got this -

Beginning Balance Interest Principal Ending Balance
1 $15,079.00 $320.52 $2,371.68 $12,707.35
2 $12,707.35 $265.64 $2,426.56 $10,280.82
3 $10,280.82 $209.48 $2,482.72 $7,798.13
4 $7,798.13 $152.03 $2,540.17 $5,257.99
5 $5,257.99 $93.23 $2,598.97 $2,659.07
6 $2,659.07 $33.10 $2,659.10 $0.00

Hard to read through the bad formatting, but the first year you pay $320.52 in interest, the second $265.64, etc, that column shows interest paid each year, which decreases yearly.

Thank you for that. Even though it doesn't look too too bad I may still just pay it off...

 

[MinnieSweetheart]

At 13%, I wouldn't even hesitate!!

We carry a car loan, but that's because our interest rate is under 1% and even though we about break even, it was nicer to have cash and we aren't paying more interest than we would make. At 13%, you are absolutely best off paying that car off.

Edit: Finally caught up... CONGRATULATIONS!!!

 

[dmc6469]

How do you figure out how much interest you are paying per month?

My original loan amount for my car was $15079.00; the Interest is at 2.29%; for a 6 year loan.

I may want to pay mine off as well...

When i went to payoff, it shows how much the payoff would be that day, the next day and so on. You just count the difference up from day to day

 

[dmc6469]

I'm almost afraid to ask, but what kind of rate do you have on your house? And who did you go through that they were charging 13% on an auto loan? That's just so beyond comparison to anything out there! If you signed on to a 13% auto loan that should have really been more like 3%, do you need to look at other things as well?

3% on my house. When I bought the car 2 years ago, my credit wasn't that bad (it has improved a lot since then) and I was really upside down in my old car that I traded. Loan was with Capital One Auto

 

[dmc6469]

Are you paying about $224.35 a month? I plugged your numbers into an online loan calculator, and got this -

Beginning Balance Interest Principal Ending Balance
1 $15,079.00 $320.52 $2,371.68 $12,707.35
2 $12,707.35 $265.64 $2,426.56 $10,280.82
3 $10,280.82 $209.48 $2,482.72 $7,798.13
4 $7,798.13 $152.03 $2,540.17 $5,257.99
5 $5,257.99 $93.23 $2,598.97 $2,659.07
6 $2,659.07 $33.10 $2,659.10 $0.00

Hard to read through the bad formatting, but the first year you pay $320.52 in interest, the second $265.64, etc, that column shows interest paid each year, which decreases yearly.

Nope, payment was $395/month. The car was brand new, and I was $4000 upside down in my old car so that was added to the loan amount

 

[Marionnette]

Nope, payment was $395/month. The car was brand new, and I was $4000 upside down in my old car so that was added to the loan amount

The minute that you drive a new car off the lot, you are "upside down" on the loan.

What kind of interest were you paying on the loan for the old car?