What happens when you finish paying your car loan?

I’m making my last car loan payment next week, and I’m not sure if there’s anything I have to do once it’s paid off. What happens when you finish paying your car loan?

Answer
Congratulations! That’s a big accomplishment, and you must be excited to be making your last car loan payment next week.
Once the loan has been paid off, you are the sole owner of the vehicle, and there are just a few things you should do, including:
  • Get your title back. Many states are title-holding, meaning the lender has the car’s title and will mail it back to you in a few weeks once they remove themselves as a lienholder. However, if you live in a non-title-holding state, you should already have the title and will need to visit the DMV to remove the lienholder.
  • Update your car insurance company by letting them know you no longer have a lien on the title.
  • Review your car insurance policy. Now that you are the sole owner of the vehicle, you can remove the comprehensive and collision coverage, although it is wise to keep.
When updating your car insurance company and making coverage changes, your rate will undoubtedly change. If you want to ensure you’re getting the best rate, use Jerry, an insurance comparison app that shops for low prices with over 50 different insurance companies for free.
If you’re hesitant to switch plans or insurance providers because you’re worried about the work involved, don’t be. Jerry does all the paperwork for you and even helps cancel your old policy! And if you have any questions along the way, just text one of our agents through the app. They will always be there to assist you.
Jack Walsh
Answered on Dec 01, 2021
Jack is an insurance specialist and writer living in Buffalo, New York. He has a BA from Union College and worked as an insurance agent with Jerry before joining our content team. He enjoys using data and research to break down complex subjects and convey a story. In his spare time, Jack enjoys cycling, cooking, and exploring Buffalo’s beautiful waterfront.
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