Settling car finance early

adamc260

Hey everyone

My car finance is due to end in November.

Over the past few months I've saved up quite a bit from getting bonuses in work but because I'm changing departments the bonuses wont be so high

I'm able to pay my car finance off early (As in... tomorrow) but wondered If I would be charged extra for doing this because I'm settling early?

I'm with Blackhorse (Car bought at motorpoint). I know it's probably hard to comment but... from peoples experience at least!

warren88

Ring them and ask for a settlement fee, when I rang they told me they use some kind of formula to calculate the final payment, they take into consideration you are paying early and you would actually save a bit, for example if I paid now I would pay £3000, but if I paid as agreed over the next 1 and a half years then I would pay £3300 or so)

adamc260

Mine was done over 14 months

1st payment was 250... 11 payments of 250 and then 1 final payment of 354 i think it is? Will have to speak to them! Just really want the finance gone so I can look at the car and think 'thats mine I dont owe a penny!' and I can start saving the finance payments instead

adamc260

Just called them and they're closed till tomorrow !!

milan_ns

Usual penalty for paying early is a months worth of interest.

adamc260

all done ! debt free now! saved £200 in interest by paying it early compared to leaving it till november

shepherd7

hi

i need help with the very same thing as adamc260. i used car finance to buy my second hand car in December 2007, i received a letter today showing me how much i have left on the balance which is currently £2,137 left to pay till Dec 2012. so i was wondering should i pay off the balance now which i can afford if i use my savings or should i continue to pay £126 a month?

many thanks for your help

adamc260

really depends, the way i looked at it was, i had the money spare sat in a savings account, i wouldn't of made £200 quid interest so... was cheaper for me to just pay it now

it's nice not owing anyone any money too!