Question by Brittany:
Whats the difference between the payoff amount and principle amount on a automobile loan?
On my automobile loan statement is states that the principle amount is 18,100 and states “this is not the payoff amount, to get the pay off amount, call customer service”. But when I called and asked them for the pay off amount they stated 18,300. I do not understand, is not the pay off amount supposed to be LOWER than the principle amount???? Help please :/


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Answer by starrfyrre
No, the payoff amount would include any interest accrued since your last payment and possibly an early payoff fee. Your principle amount does not include any accrued interest or fees.

Answer by Debdeb
The payoff will include the interest accrued from the date of the last payment until the day the loan is paid off. The principal balance is the principal you owe. It doesn’t include accrued interest.

You pay your loan on March 1, and on that day your principal is $ 18,100. Now on April 1, you request the payoff and the amount they give you includes the $ 18,100 which is the principal balance and the $ 200 accrued interest for April. Which sounds like a lot of interest, but is not this the real estate section? I do not know what rates on automobiles are these days.

I have customers state the same thing, i.e. the payoff should be lower than the principal, but I do not know where people get that idea. In addition to interest, there could be fees or late charges, or whatever else you might owe the lender.

Answer by luna
Hi , the site below is a financial,credit and Loan guide directory and able to help you answer your question”

http://www.icanguide.com

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