2007-07-26 12:02:57 · 7 answers · asked by Costly 1 in Cars & Transportation ➔ Insurance & Registration
under the terms of most loans you have to pay the interest to the date of the payoff on the principal of the loan. in other words if you payoff the note early you will only be charged the earned interest to the date of the payoff, and the other unearned interest is not used and therefor not paid.
2007-07-26 12:15:01 · answer #1 · answered by mhp_wizo_93_418 7 · 0⤊ 0⤋
I think your talking about being "upside down" on your payments. This means you owe more than the car is worth and it happens more often than it should.
When the car is totalled, the insurance company is going to give you (or the lender) money based on the value of the car, NOT how much you owe.
Car worth = $22,000
Amount owed= $26,000
Insurance will pay $22,000
You still owe= $4,000
To avoid this, most insurance companies offer GAP insurance which will actually pay any additional debt on the car. So in this senario, GAP coverage would pay the extra $4,000. It's usually pretty cheap too.
2007-07-26 19:38:39 · answer #2 · answered by Nate W 5 · 0⤊ 0⤋
if your car is totalled -you owe what ever your insurance co does not - But what is owed on the interst that had accured that month only (interest is paid on loan each month) so if you had 15 month left on the loan you would owe 1 month of interest- interest will accue every month until the balance is paid off
If you got gap insurance on your loan - than gap will pay what ever the insurance company does not
2007-07-26 22:11:46 · answer #3 · answered by butch 5 · 0⤊ 0⤋
A contract is in writing. You agreed to pay it and that is what the lender expects. You should have insurance on the car if it was financed. That was part of the loan agreement.
2007-07-26 19:10:14 · answer #4 · answered by Fordman 7 · 1⤊ 1⤋
Just because your car is wrecked, it doesn't mean you do not have to pay. Insurance companies have a policy called gap insurance to cover such problems. If you didn't have to pay, a lot of people would wreck their cars to get out of paying for them.
2007-07-26 19:10:33 · answer #5 · answered by mybuttstinks2001 5 · 1⤊ 0⤋
Depends on the loan. You DEFINATELY have to pay the loan balance off, and there MIGHT be a prepayment penalty (ie, full interest) on your loan agreement.
2007-07-26 20:44:37 · answer #6 · answered by Anonymous 7 · 0⤊ 0⤋
If you still have a loan you still have the payments. Doesn't make any difference whether or not you still have the car.
2007-07-26 19:07:51 · answer #7 · answered by Anonymous · 1⤊ 1⤋