Is it worth paying the reaminder of my car loan off?
Is it worth paying the reaminder of my car loan off?
I got my car (2020 Ford Fusion Hybrid SE) new 3 years ago at $25k for a 6 year loan @ 0% interest for entirety of loan, $350 a month payment. I'm about halfway paid off and have about $12.5k left on it. What should I do? I just get sick of paying $350 a month.
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I see, and I hope I'm not coming off as patronizing or anything; however, what happens at the end of the 6 years if you fail to pay everything back? From my understanding of 0% interest loans (which I'm not a particularly financially savy person), if it's not paid back by the end of that time (6 years in this case) you'll most likely receive huge penalties. Not only to your credit score, but also to your wallet since you'll probably be required to pay back much more at that point. Maybe you don't make regular monthly payments, and there are no immediate penalties, but at the end of those 6 years you'll still owe what's left. I'd rather make a bunch of $350 payments than one $12.5k payment. Unless you could afford that, I just don't think most people can ¯\_(ツ)_/¯
I just think staying in your current payment plan would be best. No matter what, you'd have saved at least $350 for your car each month, you might as well just pay it as it goes. Don't pay it of too early it anything, but do what you can to reach that end goal. I could be wrong, but I doubt a car dealership would give out an untimed, pay whenever you want loan to somebody. Most dealers are out to make money and giving somebody a loan like that wouldn't do them any favors. Even if you have good credit.
I have autopay set every month to automatically pay $350. I've never missed a single payment.
Then I'd keep that up. Sounds like you're doing great!
Thank you, just kinda sucks that with 0% there's really no incentive to pay it all now and have $350 to myself every month
With 0% interest there's no incentive to pay it off any sooner but that also means that if you aren't paying sooner you aren't getting any penalty.
Instead, you can literally do anything else you want with the extra money you might have otherwise spent on paying off the loan early. You can invest it or just stick it in a savings account since those are pretty high-yield right now.
In today's high-interest financing environment, having a low interest loan around is practically an asset; take full advantage of it because it's going to be a minute before we see cars again being sold at 0% interest (unless car companies get super desperate)