If I pay off my car loan fund at the beginning, can they still charge me the full amount owed in interest? I asked the credit if I pay off my loan early, should I back up and they answered "NO" you will always pay the full amount including interest, etc. .... help! it does not seem right!
You should check your loan agreement and see what is written there.
Depends on the wording of your loan. If it says that you must pay the full amount of the loan, including any interest, even if you pay early, then you're boned. read carefully.
In some states, like New York there is no prepayment penalty allowed by law, which means you can pay off your loan on one principle, no interest in coming. Tell us what state you are, and what the credit union that you are using, someone can find the legislation ready.
No They can not charge interest on not using FUNDS. They probably do not understand your question. You pay interest on the balance you are using. credit unions usually have some of the best lending rules. You must pay the full amount you owe and the interest on that amount. ex. If your balance is 6000.00 you might have to pay 6150.00 to close the loan. They can not charge you for 6000, 1500 plus interest on the long term unless you reduce the length ... I'm sure it was a misunderstanding between the parties.
I agree with the previous opinion: check your contract more carefully! But in most cases, you can pre-pay a loan off without penalty. I did it with my car loan once already. If the body does not agree with that, then I'll try to talk to a loan manager. More than likely, you can get the best interest waived off.
Posted on March 28, 2010.
