CAN I PAY OFF MY CAR LOAN EARLY?

Many Dawsonville drivers are wondering how to pay off a car loan early, not to mention if it's even good to pay off a car loan early. Luckily, the finance team at Andean Chevrolet is here to walk you through the process! It is indeed possible to pay off your car loan early, and in this guide, we'll cover the following:

• When paying off a car loan early is or isn't a good idea
• How to pay off a car loan early

If you have any other questions about the car loan process, be sure to check out our other car buying tips!

Is it Good to Pay Off Your Car Loan Early?

After you buy your new vehicle, it can be tempting to try and calculate how quickly you can pay off your loan. If you have the funds and stick to a schedule, it is entirely possible to pay off your car loan earlier than originally planned. Doing so will reward you with lower interest paid overall over the course of your loan, in addition to decreased chances of becoming upside down on your loan. In short, it's good to pay off your car loan early, so you're one step closer to financial freedom!

When You Should Pay Off Your Car Loan Early

• If you have little to no other debts and can make higher monthly payments, it can be a good idea to pay off your car loan early.
• Have you saved up extra money? Have some money in your typical budget to spare? As long as paying more on your car loan doesn't affect any emergency funds or other finances, this is also an instance where paying off your loan early is a solid choice.
• If you're looking to improve your debt-to-income ratio, you also may want to explore this option.
• If you want to lower your overall monthly expenses to plan for another financial goal, like buying a house or entering retirement, this also might be a good idea for you.

When You Shouldn't Pay Off Your Car Loan Early

• If you don't have emergency funds set aside, you should probably skip paying off your car loan early.
• If you didn't get a good interest rate on your loan, it may be a better choice to skip paying off your loan early. Rather than spending money on interest, you could set aside money for a retirement fund or another financial goal.
• Working on your credit score? Making on-time payments every month can actually help you continue to build your credit history and even raise your credit score.
• Check your loan agreement - if there are any prepayment penalties, you should skip paying off your loan early and continue to pay your scheduled amounts every month.

How to Pay Off a Car Loan Early

Still wondering how exactly to pay off your car loan early? Here are a few routes to explore:

• Round up your payment each month.
• Make bi-weekly payments instead of monthly payments (but check with your lender to make sure this is within your loan agreement).
• Make an extra payment each year in one lump sum.
• Avoid skipping loan payments, even if your lender offers you the option a few times a year.
• Refinance with a new car loan.

Rely on Andean Chevrolet for Finance Tips!

If you have any remaining questions regarding your car loan, feel free to get in touch with our Atlanta-area finance team! Whether you need guidance or want to explore the option of refinancing your car loan, we can help. Feel free to contact us at your convenience or pay us a visit near Canton!

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