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What can I save if I pay off my car loan?

Tara Baukus MelloQuestionDear Driving for Dollars,
I want to pay off my car loan early because of the high interest rate. How can I figure out how much I will save?
-- Janna

AnswerDear Janna,
Bankrate's early payoff calculator will allow you to easily calculate what you will save if you pay off your car loan early, either by adding a small additional amount to your monthly car payment or by paying it off in one lump sum.

Be sure to double-check your car loan paperwork to make sure there is no penalty for paying it off early. Lenders will sometimes add these clauses to auto loans as a way to make up for the interest they lose on a car loan that is paid off early.

If your auto loan does have an early payoff fee, it still may make the most financial sense to pay it off early. Just do the math to be sure.

Get more news, money-saving tips and expert advice by signing up for a free Bankrate newsletter.

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If you have a car question, email it to us at Driving for Dollars. Read more Driving for Dollars columns and Bankrate auto stories. Follow her on Facebook here or on Twitter @SheDrives.
 

Bankrate's content, including the guidance of its advice-and-expert columns and this website, is intended only to assist you with financial decisions. The content is broad in scope and does not consider your personal financial situation. Bankrate recommends that you seek the advice of advisers who are fully aware of your individual circumstances before making any final decisions or implementing any financial strategy. Please remember that your use of this website is governed by Bankrate's Terms of Use.

 

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