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Can I pay more on my car loan?
I’ve been driving for Uber and Lyft in my spare time, and I want to use the extra income to help cover my monthly bills and expenses—especially my car loan. Are you allowed to pay extra toward a car loan?
Jack Walsh · Updated on
Reviewed by Shannon Martin, Licensed Insurance Agent.
Rideshare programs like Uber and Lyft are a great way to supplement your income, and using the extra money to help cover your monthly bills and expenses is a great idea!
In general, you can pay more on your
car loan
. The process will differ depending on whether you want to increase your monthly payments or pay a lump sum. But before you make any additional payments, you should contact your lender.If you want to increase your monthly payments to pay the loan off faster, you’ll need to refinance the loan. When you refinance, you sign a new loan agreement with updated terms that better match your current financial situation. Be sure to shop around to compare offers from multiple lenders in order to find the best refinancing rate.
Alternatively, if you want to make a lump-sum payment, you should contact your lender and:
- Confirm an extra payment is allowed
- Ask about anyprepayment penalties
- Ensure the payment is not considered an early payment for the following month
- Confirm the payment will be applied to the principal and not used to cover accrued interest
Also, now that you’re driving for Uber and Lyft, you should review your
car insurance
policy and make sure you have rideshare coverage
. If you discover you need rideshare coverage, give Jerry
a try.Jerry is an insurance comparison app that shops for low prices with over 50 different insurance companies, many of which offer rideshare coverage. You will get quotes in seconds, can make changes at any time, and if you ever have any questions, agents are just a text away! They can even help cancel your old policy.
View full answer
- 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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