What does payment reversal on a car loan mean?

I recently paid ahead on my car loan, but I got an email from the lender that said they were going to do a "payment reversal." The lender said you could only be three months ahead on your loan, so I understand that. But what does a payment reversal mean?

Some loans have caveats that you can only be ahead a few months on your loan; this is relatively common.
To answer your question, a payment reversal simply means they’re going to send your money back to you. You aren’t out anything; they’ll just credit your bank account for your last payment.
If you want to get ahead on your car loan, don’t just spend money on the actual loan payment. Instead, put your extra cash toward the principal. Known as a principal-only payment, this money lowers the overall amount you owe, which leads to less money spent on interest over the life of the loan.
Another way to save money is with your car insurance. You can get the best deal fast with the Jerry by comparing 50+ top insurers.
Eric Schad
Answered on Nov 29, 2021
Eric Schad has been a freelance writer for nearly a decade, as well as an SEO specialist and editor for the past five years. Before getting behind the keyboard, he worked in the finance and music industries (the perfect combo). With a wide array of professional and personal experiences, he’s developed a knack for tone and branding across many different verticals. Away from the computer, Schad is a blues guitar shredder, crazed sports fan, and always down for a spontaneous trip anywhere around the globe.

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