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How do you pay off a car loan?
I’m ready to pay off the remainder of my auto loan. How do you pay off a car loan so you don’t have to keep making monthly payments?
Matthew Macgugan · Updated on
Reviewed by Shannon Martin, Licensed Insurance Agent.
Reaching the end of an
auto loan
is such a great feeling! You can pay off a car loan by settling your remaining balance with the lender. But, this isn’t necessarily the balance reflected in your last statement. The payoff quote is the exact amount you’ll need to pay your loan provider to settle the debt and become the full owner of your vehicle. This includes interest charges, service fees, and other charges added to the cost of your vehicle. You can find your payoff quote on your lender’s website by logging in with your credentials, or by giving them a call and requesting it.
Once you have the payoff amount, you can make a payment to the lender via check. There may be other options for payment depending on the lender, so check with your specific company for details.
Once you send payment, the lender will notify the DMV, which will send you the title for your vehicle via mail.
One thing to keep in mind: If you’re paying your car loan off early, check with your lender for any
prepayment penalties
, which can offset any potential savings from paying your loan off early.Once you pay off your loan and have full ownership of your car, you have the freedom to change your car insurance coverage. Lenders require full coverage for financed vehicles. You might still want to keep full coverage, but now you have the option to change it.
If you want to shop for the best deals on car insurance, download the number-one-rated car insurance app,
Jerry
. Jerry compares personalized quotes from over 50 of the nation’s leading providers, including Nationwide, Allstate, and Travelers, and delivers the best deals to your phone in minutes for free. The average Jerry driver saves $879 a year on car insurance.Congratulations!
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Jerry partners with more than 50 insurance companies, but our content is independently researched, written, and fact-checked by our team of editors and agents. We aren’t paid for reviews or other content.
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