Stupid question probably, but... - Camaro5 Chevy Camaro Forum / Camaro ZL1, SS and V6 Forums

IAINIDIRIEIWI · 09-21-2011, 04:02 PM

Lets say I bought a car for $25,000 including taxes, and then I financed the rest and interest brought up the total price to lets say 27,000.

If I trade it in later for 23,000. I paid off a little bit so when i get the money for the trade in will I have to pay that leftover interest from the finance?

Raptor626 · 09-21-2011, 04:03 PM

I would think so. You still owe that money.

TheHorse13 · 09-21-2011, 04:10 PM

Your payments are based on the cost of money (interest) over the life of the loan. Call your lending source and ask for a buyout amount and you'll see exactly what you owe and for how long that amount is good for.

SSSugar · 09-21-2011, 04:15 PM

If you financed and then sold the car before the loan is paid off, you will only have to pay the total principal owed and the interest on the loan up to and including the day you sell/trade it. Only your lender can give you an exact payoff amount.

jtzako · 09-21-2011, 04:22 PM

You do have to pay the difference if there is one. However, if you finance 25k the other 2k is interest and you dont have to pay that entire thing. You would have already paid some of the interest and principle making monthly payments. So lets say you still owe 24k (not including interest) you would have to pay 1k plus the interest that accrues between now and the payoff date. (they usually give you a quote good for 10 days)

upflying · 09-21-2011, 04:26 PM

If you owe more than the car is worth, it is called "upside down".

jasycz28 · 09-21-2011, 04:45 PM

For car loans your interest in calculated monthly based on the principal owed.

IAINIDIRIEIWI · 09-21-2011, 04:56 PM

Thanks, cleared it up for me a bunch. I'm going to see if I can trade in my LS for an SS!

2010SS2SS · 09-21-2011, 04:59 PM

Interest is pro rated on the time you have the loan open. On a simple interest contract interest is calculated at the end of the month on the principle owed.

fielderLS3 · 09-21-2011, 05:00 PM

You basically pay interest as you go. You only pay interest on money owed. If you paid the entire car off today, you would only owe the balance of the principle remaining. Once the principle is paid off, there is no further interest, because there is no principle left.

By the way, this is why if you have any extra money to put toward a loan beyond the required payment, you should always put it toward the loan. By paying a little extra, you are not just paying the loan off earlier, you are also saving all the interest that would have accumulated on that money through the remaining term of the loan. i.e. if you have 5 years left on a loan at say 5%, and pay an extra $100 this month, you will save $25 on interest. Do that every month, and it really adds up.

upflying · 09-21-2011, 05:46 PM

Quote:

Originally Posted by IAINIDIRIEIWI

Thanks, cleared it up for me a bunch. I'm going to see if I can trade in my LS for an SS!

In this case, the money you owe on the LS will be rolled over to the new loan on the SS.
Due to the added risk, your lender may require a larger down payment and higher interest rates depending on your credit rating.

RichGreene · 09-21-2011, 05:58 PM

I think the rules of 78s were outlawed. That was a system where you were actually financing the complete total of the car purchase and ALL the interest, instead of a simple interest loan where the interest is calculated on the principle. If it hasnt been outlawed, it should be. Make sure and sign for simple interest and dont be too antsy where you loose your mind in the finance guys "Hot Seat". I also tell them if they even mention the choke and croak insurance or extended warranty upgrades the deals OFF.

1CamaroSS · 09-21-2011, 06:03 PM

Does anybody know if you do pay extra.....Should you pay the extra as an additional payment or is it the same if you lump the extra into your normal payment? I ask because I always pay about $50 extra a month and on the next month bill it just lowers the next month payment by the additional amount I paid.

GARYSSS · 09-21-2011, 06:08 PM

I think you have to tell the bank you want it put on the principal.

09-21-2011, 04:02 PM	#1
IAINIDIRIEIWI Automobile Rookie Drives: 2011 Victory Red LS Stock Camaro Join Date: Jun 2011 Location: Alpharetta, Georgia Posts: 94	Stupid question probably, but... Lets say I bought a car for $25,000 including taxes, and then I financed the rest and interest brought up the total price to lets say 27,000. If I trade it in later for 23,000. I paid off a little bit so when i get the money for the trade in will I have to pay that leftover interest from the finance?

09-21-2011, 04:15 PM	#4
SSSugar American Muscle Car Club Drives: '11 2SS/RS Summit White/IOM stripes Join Date: Jun 2011 Location: Panama City, FL Posts: 399 View My Garage	If you financed and then sold the car before the loan is paid off, you will only have to pay the total principal owed and the interest on the loan up to and including the day you sell/trade it. Only your lender can give you an exact payoff amount. __________________ *Current Toys:* *1969 VW Beetle Convertible (Ruby), Red w/ white top, EMPI black 8-spoke wheels,* *License Plate: Bug Eyes* *1972 Camaro Z-28 (Baby), Haul Ass Orange w/black stripes, 350 crate motor, black powder coated wheels* *License Plate: 2Cool Z* *2010 Camaro 2SS/RS (Spice), Inferno Orange Metallic w/painted Summit White rally stripes, LS3 6-speed (HIS)* *License Plate: 2Cool SS* *2011 Camaro 2SS/RS (Sugar), Summit White w/ painted Inferno Orange Metallic rally stripes, Inferno Orange interior, L99 automatic (HERS)* *License Plate: 1Kool SS*

09-21-2011, 04:22 PM	#5
jtzako Drives: 2010 IBM Camaro SS Join Date: Jun 2007 Location: DFW, Tx Posts: 1,157	You do have to pay the difference if there is one. However, if you finance 25k the other 2k is interest and you dont have to pay that entire thing. You would have already paid some of the interest and principle making monthly payments. So lets say you still owe 24k (not including interest) you would have to pay 1k plus the interest that accrues between now and the payoff date. (they usually give you a quote good for 10 days) __________________ 2010 Camaro SS Imperial Blue \| CAI Inc, CAI \| Solo Hi Flow Cats \| X-Pipe \| Backup Camera \| PDIM

09-21-2011, 04:45 PM	#7
jasycz28 J.Sick Drives: 2010 Camaro SS Join Date: Nov 2010 Location: Ardmore, OK Posts: 958	For car loans your interest in calculated monthly based on the principal owed. __________________ "J.Sick" 2010 Camaro 2SS

09-21-2011, 05:00 PM	#10
fielderLS3 Drives: 2016 Mazda6, 2011 Mustang 5.0 Join Date: Mar 2010 Location: Portage, Wisconsin Posts: 4,049	You basically pay interest as you go. You only pay interest on money owed. If you paid the entire car off today, you would only owe the balance of the principle remaining. Once the principle is paid off, there is no further interest, because there is no principle left. By the way, this is why if you have any extra money to put toward a loan beyond the required payment, you should always put it toward the loan. By paying a little extra, you are not just paying the loan off earlier, you are also saving all the interest that would have accumulated on that money through the remaining term of the loan. i.e. if you have 5 years left on a loan at say 5%, and pay an extra $100 this month, you will save $25 on interest. Do that every month, and it really adds up. __________________ 2022 1SS 1LE (Arrived 4/29/22) "The car is the closest thing we will ever create to something that is alive." . 2022 1SS 1LE (Coming Soon)

09-21-2011, 04:03 PM	#2
Raptor626 Account Suspended Drives: 2011 Camaro SS Summit White Join Date: Apr 2010 Location: Astoria, New York Posts: 796	I would think so. You still owe that money.

09-21-2011, 04:10 PM	#3
TheHorse13 Drives: 2011 Black SS M6 Join Date: Oct 2010 Location: Harpers Ferry, WV Posts: 1,116	Your payments are based on the cost of money (interest) over the life of the loan. Call your lending source and ask for a buyout amount and you'll see exactly what you owe and for how long that amount is good for.

09-21-2011, 04:26 PM	#6
upflying Drives: '86 Monte Carlo SS Join Date: Nov 2010 Location: Reno, NV Posts: 3,119	If you owe more than the car is worth, it is called "upside down".

09-21-2011, 04:56 PM	#8
IAINIDIRIEIWI Automobile Rookie Drives: 2011 Victory Red LS Stock Camaro Join Date: Jun 2011 Location: Alpharetta, Georgia Posts: 94	Thanks, cleared it up for me a bunch. I'm going to see if I can trade in my LS for an SS!

09-21-2011, 04:59 PM	#9
2010SS2SS Drives: 2010 Camaro SS 2SS Join Date: Aug 2009 Location: Cypress, texas Posts: 1,302	Interest is pro rated on the time you have the loan open. On a simple interest contract interest is calculated at the end of the month on the principle owed.

09-21-2011, 05:58 PM	#12
RichGreene Account Suspended Drives: 2011 1SS M6 Green 1993 Custom Eldo Join Date: Jul 2011 Location: Ohio Posts: 973	I think the rules of 78s were outlawed. That was a system where you were actually financing the complete total of the car purchase and ALL the interest, instead of a simple interest loan where the interest is calculated on the principle. If it hasnt been outlawed, it should be. Make sure and sign for simple interest and dont be too antsy where you loose your mind in the finance guys "Hot Seat". I also tell them if they even mention the choke and croak insurance or extended warranty upgrades the deals OFF.

09-21-2011, 06:03 PM	#13
1CamaroSS Drives: 2011 Camaro 1SS Inferno Orange Join Date: Jul 2011 Location: Brandon, SD Posts: 323	Does anybody know if you do pay extra.....Should you pay the extra as an additional payment or is it the same if you lump the extra into your normal payment? I ask because I always pay about $50 extra a month and on the next month bill it just lowers the next month payment by the additional amount I paid.

09-21-2011, 06:08 PM	#14
GARYSSS Drives: 2010 2SSRS M6 Rally Yellow Join Date: Feb 2010 Location: Baltimore, Maryland Posts: 354	I think you have to tell the bank you want it put on the principal. __________________ TEAM LS3

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