Question: I signed up for autopay for my car loan but it didn’t take the money out of my account on the due date. I made the payment manually to avoid late fees, but the next day the automatic payment came out of my account. Can I request a refund?
Answer:
It’s unlikely that you’ll get an automatic refund for a double car payment, but you do have a few options if you accidentally make two auto loan payments in a single month.
1. Ask your lender for a refund
Calling your lender is your best option if you really need the money back in your account this month.
While you’re not guaranteed a refund, you can certainly contact your lender and ask about your options. If you have a good relationship with your lender and you’ve been a responsible payer in the past, you may be able to work out an agreement for a partial or complete refund for your extra payment.
2. Apply the extra money toward your next monthly payment
One common solution to making two payments on your car loan is applying the extra money to next month’s payment. That way you won’t be making an extra payment, you’ll just be making your regular monthly payment a little early. To pursue this option, contact your lender and ask to apply the overpayment amount to next month’s bill.
3. Apply the payment toward the principal
If you can afford to make multiple payments for one billing cycle, ask your lender to apply the extra payment to the principal of your car loan. The principal of your loan is the amount you actually borrowed for the car, but, depending on your interest rate and the terms of your loan, your car payments are typically applied mostly to the interest. Paying off part of the principal will shorten the amount of time you’ll spend paying your loan back.
The pros and cons of making two car payments in one month
If you can afford to let the extra payment go, there are some benefits to overpaying on your car loan, but there could also be some drawbacks:
| Pros | Cons |
|---|---|
| You can shorten the period of time you’ll spend paying off your loan by making a second payment towards the principal | Making multiple payments can feel financially stressful. |
| Making loan payments as agreed can improve your credit score. | Paying off your car loan early can hurt your credit score, especially if you don’t have a credit card or other lines of credit. |
| You’ll pay less interest over time by shortening the term of your loan. | You may be charged a prepayment penalty for paying off your loan early. |
Liz Jenson is an insurance writer who specializes in general automotive and insurance topics. Liz’s mission is to produce informative and useful content to help car owners make smart choices when buying cars and car insurance. Since joining Jerry in 2021, Liz has written nearly 4,000 long- and short-form articles on topics including state-specific insurance recommendations, common car insurance questions, and deep dives into vehicle model details. Before they came to Jerry, Liz was a full-time student at Indiana University, Bloomington working on a double major in English and French.
Sarah Gray is an insurance writer with nearly a decade of experience in publishing and writing. Sarah specializes in writing articles that educate car owners and buyers on the full scope of car ownership—from shopping for and buying a new car to scrapping one that’s breathed its last and everything in between. Sarah has authored over 1,500 articles for Jerry on topics ranging from first-time buyer programs to how to get a salvage title for a totaled car. Prior to joining Jerry, Sarah was a full-time professor of English literature and composition with multiple academic writing publications.
