Author Topic: Early buyout of a finance. (Read 4576 times)

JSCC · « **on:** March 04, 2005, 12:08:06 pm »

This is something that I still don't understand.
Say, I finance a car:

0 down, 60 months, 1.8%
the payments are 500/month tax-in

1. If I want to buy the car at the 20th month, do I pay (500*40 - interest) + some sort of penalty?

2. If I pay 10,000 at the 20th month. What happens to the remaining payments?

Shnak · « **Reply #1 on:** March 04, 2005, 12:14:14 pm »

1. When you finance a car, the loan is open which means that you can put any amount of money you want on it at any time. Nothing prevents you from paying it off completely at the 20th month. No penalties. You'd only have penalties if the car was leased.

2. Your payments remain the same, but you have less payments to do. In your example, you'd have 20 less monthly payments to do. You save a lot of interests by doing this.

JSCC · « **Reply #2 on:** March 04, 2005, 12:29:29 pm »

Cool, 0 down all the way!

Shnak · « **Reply #3 on:** March 04, 2005, 01:38:10 pm »

as long as you can afford the payments...

Oh, and wouldn't a car salesman need to know those things?

JSCC · « **Reply #4 on:** March 04, 2005, 01:43:23 pm »

Ha Ha.
Now you know what kind of people are selling cars huh?!
Most of the stuff I pick up on my own.
Seems like the training was not enough.

mrthompson · « **Reply #5 on:** March 04, 2005, 01:58:14 pm »

Don't you know who you're dealing with Shnak? Jscc is really...

Shnak · « **Reply #6 on:** March 04, 2005, 02:03:20 pm »

mrthompson · « **Reply #7 on:** March 04, 2005, 02:05:26 pm »

I'll quit now. I hope you don't mind the ribbing, Jscc?

(Please no jokes about condoms, Saffy.

)

safristi · « **Reply #8 on:** March 05, 2005, 07:56:40 am »

I will if you quit rubbin' IT IN !!!!!!

neil · « **Reply #9 on:** March 06, 2005, 03:06:37 am »

oh boy

wing · « **Reply #10 on:** March 06, 2005, 09:07:20 am »

If you buyout a lease (Honda and from what I remember Hyundai as well) there is no penalty either, just buy + whatever payments are left minus the interest on those payments.

ArticSteve · « **Reply #11 on:** March 06, 2005, 08:44:05 pm »

On a lease you pay ALL the interest of the agreed to term.

Sterling · « **Reply #12 on:** March 06, 2005, 11:56:40 pm »

No, you do not. At least not with Ford Credit, GMAC, Chrysler Credit, and as Jamesbe said, Honda, nor Hyundai.

ovr50 · « **Reply #13 on:** March 07, 2005, 12:19:59 am »

Nor with Toyota.

ArticSteve · « **Reply #14 on:** March 07, 2005, 02:28:43 pm »

I misread James who I thought was talking about terminating a lease and not purchasing the car at the same time.

Yes, Honda for sure allows early buyouts pursuant to a Honda amortization table. No termination fees. I checked this out when I bought the 2002 SIR and went with their finance rate for 5 years.

Sterling · « **Reply #15 on:** March 07, 2005, 10:40:53 pm »

Yup, that's correct. If you want to end your lease early and give the car back just add up all your remaining payments plus any mileage or damage/wear charges.

Author Topic: Early buyout of a finance. (Read 4576 times)

Sterling

Sterling