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How To Easily Pay Off A Car Loan Early In Smithville

How To Easily Pay Off A Car Loan Early In Smithville

Auto loans are a part of life as much as wide open spaces, traffic in the morning and maple syrup on pancakes. Yet, they don’t have to be forever. You can easily pay off a car loan early, freeing yourself of one more monthly outgoing.


Our Smithville auto loan team outlines the best ways to easily pay off a car loan early.


Before you do any of these, make sure you can overpay your auto loan. The vast majority of those our Smithville auto loan team provides can be overpaid. Check your paperwork to make sure.


Also, make sure you specify to the lender that any overpayment you make comes off the principal and not the interest. The principal is the amount you borrowed before interest and that’s what we want to pay off.


Rounding up


Rounding up your monthly loan payments is a very effective way to overpay your auto loan. You can overpay by a little or by a lot, depending on your situation.


For example, your current auto loan payment is $314 per month. You could round up to $400 per month and overpay by $86. Or you could round up further to $450-500 depending on your situation.


Monthly overpayments


You can use the rounding up method to overpay on a monthly basis but you can also use a random, affordable amount too. If you can afford to add any reasonable amount to your monthly payment, do it.


Even if it’s $50-60 per month, over several years, this will shorten the term by a few months and your interest burden by several hundred dollars. That’s definitely worth doing!


Fortnightly payments


The majority of Smithville auto loans are paid monthly, which works for the majority of situations. However, you can elect to pay fortnightly if you want to.


If you’re paid fortnightly, this can have a real benefit. Plus, paying your loan amount in two stages can actually lower the interest due overall. It’s a modest improvement but you will be able to pay the loan off faster this way.


Lump sum overpayments


You can also make lump sum overpayments on an auto loan. This uses a few hundred or few thousand dollars to pay down the principal amount, lowering the overall loan.


If you get a bonus from work, share dividend, sell something valuable or get income from elsewhere, you can use it to pay off a chunk of your loan.


How to overpay a Smithville auto loan


You can overpay your auto loan by contacting the lender. Monthly overpayments can be made by asking them to take an agreed amount per month along with the minimum payment.


The same for fortnightly payments. Agree with the lender and go from there.


Lump sum overpayments can be made as and when you have the money to make them. Contact the lender and tell them what you want to do. They will let you know how to make the payment.


In all cases, make it clear to the lender you’re overpaying the principal and not the whole amount!


We will use all our skill and experience to deliver the lowest possible Smithville auto loan rates, guaranteed. Contact Car Nation Canada Direct to learn how we can help.


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Categories: Auto Loan

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