cancel
Showing results for 
Search instead for 
Did you mean: 

Paying off autos, what should I do?

onthelake
Member

Paying off autos, what should I do?

Hello,

 

I have 3 loans I want paid off asap.

 

Car balance $3044, payments 206, Int 5.99 loan maturity date. 4/4/2021 ( been paying 300 but recently 350)  Im afraid it can die soon thats why I pay more. 

 

Truck  10,227 payment 355, interest 5.99  loan maturity date. 2/10/2022

 

Boat  21,637    Interest Rate   8.25 %  Original Maturity Date 6/1/2031

 

Ive been paying extra on my car, can be paid off in 9 months, but wondering if thats smartest choice? I thought Id snowball car into truck but should I throw it at the boat?  

 

Thanks  Smiley Happy

Message 1 of 7
6 REPLIES 6
dynamicvb
Valued Contributor

Re: Paying off autos, what should I do?

Personally, I would put it towards the boat to save interest. You have a much higher rate on that and the loan term is much longer. Of course, I can see the other way too where you put it towards the truck to get it paid off sooner and that one gone. Perhaps splitting between them may make sense. Have you run different scenarios through one of the pay off calculators? That may give some better insight as to money saved, etc.. 

Started Rebuild 4/2018: EX 616| TU 604| EQ 621

Current 5/28/20:


First Goal Score: 750+ Reached 3/2019

Next Goal all over 800
Message 2 of 7
SouthJamaica
Super Contributor

Re: Paying off autos, what should I do?


@onthelake wrote:

Hello,

 

I have 3 loans I want paid off asap.

 

Car balance $3044, payments 206, Int 5.99 loan maturity date. 4/4/2021 ( been paying 300 but recently 350)  Im afraid it can die soon thats why I pay more. 

 

Truck  10,227 payment 355, interest 5.99  loan maturity date. 2/10/2022

 

Boat  21,637    Interest Rate   8.25 %  Original Maturity Date 6/1/2031

 

Ive been paying extra on my car, can be paid off in 9 months, but wondering if thats smartest choice? I thought Id snowball car into truck but should I throw it at the boat?  

 

Thanks  Smiley Happy


1. First I would need to know what is your priority? Saving money, optimizing FICO 8 score, optimizing FICO 2 score, getting out of debt?

 

2. Second I would need to know the original loan amounts on all 3 loans.


Total revolving limits 677500 (584500 reporting) FICO 8: EQ 758 TU 777 EX 749

Message 3 of 7
Anonymous
Not applicable

Re: Paying off autos, what should I do?

I agree with SJs question above.

 

The smartest choice is always IMO going to be to pay off debt and incur as little interest as possible.

Message 4 of 7
keathfinancial77
New Visitor

Re: Paying off autos, what should I do?

First you need to prioritise. You have 2021 due date, 2022 and 2031 for all 3 items. In my opinion, you should finish with the car and then go for the truck so when you have the boat left, you can put alot into it.
Message 5 of 7
zerofire
Established Contributor

Re: Paying off autos, what should I do?

If you are scared that your car is about to die it would be more prudent to siphon the extra payments into a maintenance fund so when it does fail you can quickly repair it and get it back on the road. Next why do you have a boat? Unless you have an active business related to marine technology there is no point in having it. You would have been better off renting one. Lastly the fastest way to save money is to pay highest interest rate first with longest due having priority as a tiebreaker. That means the extra should be going to the boat, then the truck, and lastly the car since the longer end time will cause interest to not accrue interest on top of itself while the APR is the same.

TU:758 06/19/20 Bank of America--EX: 776 06/10/20 Experian--EQ:810 09/25/18 Citi--Gardening since 01/11/21
Active:
Bank of America (Better Balance Rewards M, Cash Rewards WM, Cash Rewards VS), Blispay V, Capital One (Quicksilver VSC, Walmart WMC), Chase(AARP VSC, Amazon Prime VSC, Freedom VSC, Freedom Flex WEMC, Slate VC), Citi Dividend MC, Citizens GreenSense MC, Discover It C, FedEx Employee Credit Association V, FNBO Ducks Unlimited VS, HSBC Cash Rewards WMC, PenFed (Platinum Rewards VSC, Pathfinder Rewards VSC), Synchrony Bank(PayPal Credit, PayPal 2% Cashback M), TD Bank Redcard Store Card, UMB Bank Simply Rewards V[Milford Federal], US Bank (Altitude Go VSC, Cash+ VSC)
Wishlist: AOD Signature, Bellco Colorado Rewards, EBates, Marvel, Nusenda Platinum Cash Rewards, Security Service Power Travel Rewards, Vantage West Connect Rewards, Wells Fargo Propel
Message 6 of 7
coreysw12
Valued Contributor

Re: Paying off autos, what should I do?

It depends on what your goal is.

 

If your goal is to reduce your monthly payments as quickly as possible so you can free up money in your monthly budget, then the snowball strategy is best - pay off the car asap, then the truck next, and then the boat last.

 

However, if your goal is to reduce the amount you are paying in interest over the life of the loans, then you should do the exact opposite - pay as much as you can to the boat first, while making minimum payments on the car and truck.

 

Two totally different strategies, and without knowing what your primary goal is here, it's hard to say which one you should do.

 

 

Side note - maybe look into refinancing or selling that boat... that loan has horrible terms.

    Total Loan Balance: $58k / $65k

    Total SL: $42.4k
Goal cards:



United 1K - 675,000 lifetime flight miles    |    Chase Status: 3/24
Message 7 of 7
Advertiser Disclosure: The offers that appear on this site are from third party advertisers from whom FICO receives compensation.