Making Your Final Car Payment

final car payment Making Your Final Car PaymentThe day has finally arrived, the day you have waited for since signing your loan documents five years ago…you are about to make the final payment on your vehicle, and it is now completely yours! Hopefully your vehicle is in good condition and you are approaching this final payoff with relief of now owing nothing on your car, freeing your hard-earned money to be used elsewhere instead of being chained to a vehicle loan. If that is the case, there are a few things to keep in mind as you send in that final payment.

First, do the math yourself and make sure that the final payment amount is correct. It will often be different than the regular monthly payments have been throughout the life of your loan, so be certain that you pay the correct amount. Also, read the fine print and make certain of the form of payment the lender prefers for your final payment. Believe it or not, some lenders will request that your final payoff be made with a cashier’s check, certified bank check, or via direct deposit. Compliance with such requests is always in your best interest.

Next, find out who will be sending you the title to the vehicle, and when you should expect to receive it. The lender holds the title during the loan period, and then releases it to you when the loan is paid in full. Sometimes you will receive the title in the mail, other times you will be required to go and pick it up from the Department of Licensing yourself. If you do have to go and retrieve it, be sure to bring picture identification of yourself. There is usually no fee for the title. A vehicle title is a legal document, so keep it in a safe place. Safe deposit boxes at your bank or a fire-proof document safe in your home are both good ideas.

Lastly, check into your vehicle’s warranties and any fine print that might change warranty coverage after a certain period of time. Some warranties can be placed into effect by the lender in order to cover their investment, but are no longer valid once ownership changes to the purchaser. Be sure of what is still covered on the vehicle you now own outright so that you don’t run into surprises down the road when having services performed.

Ultimately, it is a great day when you finally pay off your vehicle loan. Congratulations, and enjoy the freedom in your budget now that you are free from a vehicle loan!

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