NOTE:The process at the end of your contract is different for lease customers. Visit ourLease-Endpage for details.
So, you’re reaching the end of your car loan, and your vehicle is almost 100% yours. What do you do now? Check out answers to some of the most popular questions about the end of your contract:
How do I make my final payment and pay off my account?
Details on making your payoff can be found by logging in to MyAccount and selecting “Request a Payoff” under the Payment Progress section. In the GM Financial Mobile app, it’s in the Vehicle Account Details screen accessible from the dashboard.
You’ll have to request your payoff for it to show up, and right now, they’re only available for retail customers.
When do I get my title?
Processes and time frames for releasing titles and liens vary by state, and GM Financial releases them within those requirements. Check your state’s website to find out the details that apply to you.Your final payment will need to be received and processed by GM Financial before your title or lien can be released.
Is the account balance shown in MyAccount the same as my payoff balance?
Not necessarily. Interest charges, fees or other charges applied to your account could create a difference in the two balances. Your payoff balance is ultimately what you owe on your account.
What should I do once I’ve paid my payoff balance in full?
Once you have your title and own your vehicle outright, you have two options:
- Research the trade-in value of your car and consider leasing or buying a new GM vehicle. You can save time at the dealership byapplying for financing online.
- Or, drive payment-free for as long as you like. It’s yours! Maintain regular dealership visits for tune-ups and servicing to help keep your beloved vehicle on the road even longer.
What happens if I still have a balance due on my vehicle, but want to trade it in to get something new?
Contact your dealership to discuss your options, which may vary based on how much you still owe, and see what you can check off of a car-buying checklist to be even more prepared. It’s also a good idea to find out your payoff amount in MyAccount before calling so you know what to expect.
By Scooter Hendon, GM Financial
Scooter Hendon might work indoors, but his heart is in the outdoors. Whether he's with his family or flying solo, he loves a good camping, backpacking or hiking adventure. When Scooter’s not hitting the road in his Chevy Silverado to a state or national park, he’s saving up for his next trip.
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FAQs
5 Once you pay off your loan, the lender will send the lien release to the DMV, which will then send you an updated title. This makes it easier to get the title for your car, but because there are more steps involved, it can take longer.
What should I do after I pay off my car? ›
Once you pay off your loan, your lienholder will send you an official release of lien letter. You'll take that to your state BMV or DMV (or, in some cases, to your local city/town clerk's office) along with your current title and apply for an updated title.
Is it better to keep a paid-off car? ›
Free up money for other expenses
Paying off your car loan is a big opportunity to progress on other financial goals. If you keep the car you have and don't take out another loan, you can put that money toward vacation savings, retirement funds or other debt.
How much does your credit score increase after paying off a car? ›
Once you pay off a car loan, you may actually see a small drop in your credit score. However, it's normally temporary if your credit history is in decent shape – it bounces back eventually. The reason your credit score takes a temporary hit in points is that you ended an active credit account.
Does insurance go down after paying off a car? ›
Is car insurance cheaper if you own your car? Car insurance premiums don't automatically go down when you pay off your car, but you can probably lower your premium by dropping coverage that's no longer required. Banks and financing companies who loan you money for your car are called lienholders.
Do you get money back if you pay your car off early? ›
Paying off a car loan early can save you money in interest in the long term. When you pay off a car loan early, you also reduce the total amount of money that you owe, which may boost your credit score. Some lenders charge prepayment penalties that can offset what you would save in interest.
How long does it take to pay a car off on average? ›
While car loan terms are usually in 12-month increments, there are lenders willing to offer other options if needed by a borrower. According to consumer credit reporting company Experian, the average auto loan term in the fourth quarter of 2023 was 67.87 months for new cars and 67.40 months for used cars.
What are the cons of paying off car early? ›
When you pay off your car loan early, your debt will become smaller. This is positive for your credit history but might lower your credit score slightly because you're no longer logging on-time monthly loan payments. Once you pay off the loan, you will no longer have positive payment history for that long-term loan.
Why did my credit score drop 100 points after paying off a car? ›
Why credit scores can drop after paying off a loan. Credit scores are calculated using a specific formula and indicate how likely you are to pay back a loan on time. But while paying off debt is a good thing, it may lower your credit score if it changes your credit mix, credit utilization or average account age.
Why did my credit score go down after paying off my car? ›
Credit utilization — the portion of your credit limits that you are currently using — is a significant factor in credit scores. It is one reason your credit score could drop a little after you pay off debt, particularly if you close the account.
One of the biggest rewards you'll reap by paying off your car loan early is the money you'll save in interest. The longer your loan is open, the more interest you'll pay. As a result, those who pay their car loan off using a lump sum will probably see more savings.
How to get 850 credit score? ›
A score of 850 can only be achieved with 10+ years of credit, excellent on-time payment history, low credit utilization, and no recent hard inquiries, which is a tall ask.
Is it better to pay off the car or the mortgage first? ›
Pay off the car loan first. The reason is that you save 8.49% on the car loan whereas on the mortgage you save only 7%. If you can deduct the interest on your mortgage, as most homeowners can, the advantage of paying off the car loan first is even greater.
Is it cheaper to get your own car insurance or stay on my parents? ›
For one thing, you might wonder if it is cheaper to get your own auto insurance policy, but the truth is, it's most likely not. Unless you are over the age of 25 and have a perfect driving record, it will be cheaper for you to just stay on your parents' policy. Your rate is based entirely on risk.
Why does my insurance go up when I remove a car? ›
Your car insurance rate went up after removing a vehicle from the policy most likely because you weren't given a multi car discount anymore. Companies usually offer a multi-car discount that lowers premiums, and when you go down to one car that discount is removed.
Is the less your car is worth the less you ll pay to insure it? ›
In general, the less valuable a car is, the less you'll pay for insurance. State: Insurance regulations and risk factors vary from state to state. As a result, there can be a dramatic difference in the average insurance rates between states.
How long to keep a car for the best value? ›
That's how much the car's value decreases over time. According to Edmunds, there's a significant drop in the first 2-3 years, and another at the four-year mark. Selling in between those drops will generally net you the best value. After that, the next big drop usually happens at around eight years.
Is it better to pay off a car before selling it? ›
Often, it's best to pay down or pay off your auto loan before selling it or trading it in. The main concern is whether you have positive or negative equity on your loan. With negative equity, you should pay off your auto loan before you trade in your car.
