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Can I pay extra on my car loan?
I want to pay off my car loan quickly. I think I can afford to make extra payments every month. How can I pay extra on my car loan?
Phoebe Mah · Updated on
Reviewed by Shannon Martin, Licensed Insurance Agent.
Paying extra on a car loan can definitely help you pay off your loan amount faster!
When making additional payments on a
car loan
, you’ll want to make sure it goes towards your principal as normal monthly payments go towards any fees and interest applied on your loan, and then a portion of your principal. To make principal-only payments, speak with your lender. You’ll want to clarify that the extra payment should go towards your principal balance and not your monthly payment.
Also, check your loan contract or ask your lender about
prepayment penalties
. Some lenders charge additional fees if you pay your loan off early, so you’ll want to know before making extra payments. Beyond principal-only payments, refinancing your loan is a great way to pay your loan off quickly. Often, you can refinance for a lower interest rate, meaning you can lower your monthly payments and put more towards your principal balance.
If you’re looking to refinance your car loan, start your search with the
Jerry
app. You can compare quotes from multiple lenders without worrying about your credit history. Jerry’s app instantly connects you with top companies to find a loan that best meets your needs. MORE: How to refinance a car
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- Gregory R.
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Jerry partners with more than 50 insurance companies, but our content is independently researched, written, and fact-checked by our team of editors and agents. We aren’t paid for reviews or other content.
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