Quote:
Originally Posted by foshjowler
The last couple of cars I've bought I have gotten my loans through reputable dealers, and this is exactly how it works. Currently my loan is through Wells Fargo, and I go on their website to make payments. I personally pay weekly and round it up to the nearest multiple of 10. I did the math one time, and just paying weekly I would pay off the loan 6 months sooner over the course of a 6 year loan, and pay a few hundred less in interest. Obviously your mileage will vary based on the details of your loan. Paying extra only improves that.
|
I've always followed the following premise when it comes to over-paying and/or paying early...
If I am able to pay more than the scheduled amount, or can pay ahead of time, I don't. Instead, I put that money into a savings account with a higher yield and let it work for me. As long as the interest rate that I am earning is either better than, or only slightly less than, the interest rate of the loan, putting that money away helps me to build a financial cushion should I need it during the course of the loan.
Once I have enough money saved up from doing the above to where I can pay the loan off in full, I do so.
And remember: If you ever have to choose between making a car payment or paying rent, make the car payment. You can live in your car but you can't drive your house. lol