My insurance pay for my truck but my bank say's i still own 6,000 dollars of interest?

Question

well i total my truck but now my bank says that i still need to pay 6000 worth of interest so i dont know what to do im need to get into a car but i still have to pay for my other truck but does this mean i have to pay the same amount that i pay for my truck payment or less

Answer 1

You, like many other people, owed more money on your old truck than the vehicle was worth. This happens when you don't put anything down on a vehicle, and take out a 6 year loan.

Your way out has nothing to do with rolling the balance into a new loan. This is only lead you into more problems. Go out and get yourself a junker, and drive it for the next year while you get the old truck paid off. Then continue driving it until you can put at least 5% down on your next vehicle, and no six year loans. If you can't pay it in 5 years, you can't afford the vehicle.

One final thought is on gap insurance. This helps cover the difference between what the vehicle is worth, and what is owed on it. If you must buy a vehicle with nothing down, then get gap insurance. You are paying for your downpayment over time. But you are still better off saving for a downpayment.

Answer 2

Hmm..... Here's what i think. The 6,000 may not all be interest. it may be whats left owing after the insurance company paid.

For example: most people are "upside down" in their cars right now. Meaning you owe more than what your car is worth. Your insurance only pays the "actual cash value" of the vehcile, not the amount you owe. So if you owe 15,000 and your car is only worth 10,000.... You will still owe 5,000.

UNLESS.... You have GAP insurance, Then your GAP insurance will pay the 5,000. Go back and check your settlement statement from when you bought the truck, you may have bought gap coverage. Many dealers add it on whether you know or not.

If the 6,000 truly is just interest..... I'd demand they send you a full detail on how they come up with those numbers.... it may or may not be correct, but 6,000 interest is a lot!

And you would actully end up paying less interest in this case than if you made every payment, because basically you are paying off the loan early.

Hope this helps.

Answer 3

It sounds like you owed more on the truck than it was worth at the time it was totalled by the insurance company, and that the $6000 you owe is not interest, but the difference between what the insurer paid and what your outstanding loan balance is. Had you had 'gap insurance', this would have been covered. Sounds like you didn't, so you owe the difference to the bank.

Answer 4

You may have owed more than the truck was worth so you owe the difference. Try not to roll this into a new loan but keep it separate. Buy a used car as cheaply as you can until you pay off the truck.

Answer 5

Oh, if you get another loan and roll the $6,000 into it, your payment will go up, unless you get a cheaper truck.

If you DON'T make arrangements or pay off the balance on the loan, you're probably not going to be able to get another loan for a while.

Answer 6

you still have to pay the bank. it may be possible for the bank or another bank to absorb the 6k into a new car loan. this will depend on your credit and debt-to-income ratio. this time when you buy a car also get "gap insurance" from the lender. if you would have had this on your truck loan the bank would have paid off the 6k for you.

Answer 7

that doesn't sound right, if the insurance company paid off the truck then it is no longer being financed so there would be no more instrest. contact your insurance company, see what they say and you can call other banks and see if they agree with what your bank is doing.