Most lenders provide a “payoff quote,” which is the amount needed to pay off your car loan in 10 days. Of course, this number can change depending on your payment schedule. Negotiating the payoff balance is different from paying off your car loan early. To do so, you’ll need to ask your lender for the payoff amount and negotiate the balance.
You can go to your lender’s website and find out the amount they need to pay off your car loan. Usually, you’ll find the payoff quote for your car loan listed online. If you owe $15k, you’ll pay off the car loan and own it free and clear. You’ll no longer have to pay interest or monthly payments.
If you’ve made a few extra payments on your car loan, you’ll be able to trade it in for a new one without incurring prepayment penalties. In fact, most lenders allow you to prepay a portion of the principal balance without penalty. Check with the lender servicing your loan to make sure you’re not subject to a prepayment penalty. However, if you don’t feel comfortable with your monthly payments, you can increase them and apply the lump sum toward the principal balance.
Another question you may be asking is, “If I pay the payoff quote on a vehicle loan, will I still owe anything else?”
