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What does it mean when your car loan matures?
I received a note in the mail that says my car loan matures in six months. This is my first-ever car loan, and I have no idea what this means. Could you explain it? What does it mean for your car loan to mature?
Eric Schad · Updated on
Reviewed by Shannon Martin, Licensed Insurance Agent.
When a
car loan
matures, you should get excited—this means that your loan is almost paid off in full! The maturity date is the last day you have to make a payment, barring any clerical errors or missed payments. After this, you own the car outright and the lender should send you a lien release.However, keep in mind that you may still have money to pay on the loan if you missed a payment or if you have any arrears as a result of added interest from a missed payment. If you’re not sure what you owe, ask the lender to provide a payoff quote, which will show you how much you have to pay in total.
After you pay off your car loan, you should also call your
car insurance
company and let them know you’ve paid off the loan. This will remove the lienholder from your loan so that all payouts or settlements from your insurance go directly to you instead of your former lender.Because you’ve paid off the loan, you may no longer want or need full coverage for your car, but it’s your decision. If you want to get the best rate on whatever type of coverage you decide on, check out the
Jerry
app! We’ll get you personalized quotes from multiple providers in seconds so that all you have to do is choose the plan that you want—and when you do pick one, we’ll even help you switch!Congrats on the good news!
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- Gregory R.
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