Auto Loan Pay Off question?
I have an auto loan. My loan is not good. I have a very high interest rate. I went through with the loan hoping to improve my credit score. A year has past, and I am considering paying off my loan. I was on my online account, and clicked on “pay off quote”. I noticed the Pay off quote increases every month.
The question is why does it increase every month? Please help.
Because they are showing you what the payoff would be with the interest added for each month – actually a payoff amount is only good for a few days anyway before it changes due to interest.
Because of interest. You are charged interest until balance is paid in full.
If you think you need to have a new or used car to support your life activity, auto loan is the kind of loan which will guarantee a loan regardless of your credit ratingany banks and car dealers around your area, but for a guaranteed approval auto loan usually available via websites.
The loan balance actually increases every day. A simple interest loan means that interest is calculated daily on the loan balance. This is why when you obtain an auto loan payoff quote, you are given a “10 day” payoff amount which gives you time to get your payment in and ensures you send enough to pay off the balance in full.