Anonymous asked in Business & FinanceCredit · 2 months ago

Making car payments?

My bother-in-law is telling my girlfriend don't try to pay off her car payment early. Its not going to be good for her credit. She will just f* herself over. 

She said she wants to try to pay off as much as she can. They charge her each day she has the loan so she if can make a bigger payment she will. It's not going to hurt. It will show she is responsible. The sooner it's paid off its one less thing she has to worry about. 

He keeps telling her paying it off early is stupid with how credit works. It will hurt her.  The long continuous study payments well I'm told her credit not paying it off sooner. 

10 Answers

  • 2 months ago

    The last car we financed was an 02 Honda CRV. Instead of paying $360 a month, we paid $500. a month and paid it off early. We then changed to car payments to our new car savings account. Since then my wife has had 3 new cars and I have had 5. I did outside sales for years hitting over 120K on 3 of my vehicles. Since '05 we've always just written checks for our cars.

    Where I may agree with brother in-law is if she has CC debt. PAY that off first and stop going into  debt. No one said it's easy, but after the 1st of the year, we'll pay off our house also. get out of debt ASAP. It's called FINANCIAL FREEDOM.

  • 2 months ago

    Car loans aren't like mortgages--paying it off sooner MIGHT incur a penalty. That long, slow, steady payment history is a very valuable thing for credit scores and credit-worthiness. 

    Your GF can pay it off early, but she needs to check first if there would be a pre-payment penalty on the loan.  AND she should be aware that paying extra on the principle every month will NOT reduce the amount of interest or change her payments. Car loans are not re-amortized for paying extra. 

  • 2 months ago

    Tell gf to pay off her debt early, as she wishes. Good credit can be maintained with regular wise use of a credit card.

  • 2 months ago

    She's right.  He's wrong.

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  • ?
    Lv 7
    2 months ago

    It won't hurt her.  Maybe a very small bit in the short run, but overall not really.

  • 2 months ago

    Paying off a vehicle early will improve your score slightly. 

  • 2 months ago

    These answers are right.

    The person who has the 4 thumbs up has the best right answer of all of the right answers.

    So, my comment is that...Your Brother in Law is a jerk and you should tell him to lay off of your girlfriend before you deck him.

    The savings in interest are more than worth  the 3 points that will come off her credit score for 2 months.

    Because the car will be paid off, in 6 months her credit score will be higher than it is now.

    Go to the store, buy your BIL a 'Fleet Enema Kit'.  Tell him to use it frequently 'cause he is 'full of it'.

  • Anonymous
    2 months ago

    As someone that paid their car off SUPER early, I can tell you that your brother-in-law is maybe 5% correct. Your score goes down a few points at most, not like, 200 or anything. My credit score went down all of 3 points when I paid off my car, and I bounced back within 4 months or so, nothing critical. 

  • Anonymous
    2 months ago

    What is your question?  

    Are you trying to ask who is right?   You didn't give enough information.

    Yes, paying off a car loan super fast (like in a couple months) can lower one's credit score temporarily as credit scores depend on how many "as agreed" payments have been made and how long the credit line has been open.   Paying some extra on each payment to pay it off a year early or something like that is A-OK.

    Is your gf contributing adequately to a retirement account?    If not, socking every extra nickel she has to the car loan is unwise IMO.    It's really hard to make recommendations without having more information.

  • Anonymous
    2 months ago

    Your brother in law is an idiot. Pay it off ASAP.  However, she CANNOT skip a payment no matter if she paid 6 extra last month.

    Her credit might be helped a tiny bit by paying it over a longer period of time but the interest savings is worth more.

    We are talking 4-6 points on her credit maybe.

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