Car Loan Mistake Turnaround

Document created by ashleynorwood Employee on Nov 6, 2015Last modified by amara.mastronardi@socialedgeconsulting.com on Dec 5, 2016
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After I totaled my used car that I hadn't fully paid for about a year out of college, I decided to buy a new one. I was young and naive, and didn't really consider what I was doing. I opted for the lowest payment possible and drove off the lot. Well, my interest rate was sky high, and I had agreed to pay for 8 years! I was looking at paying well over $30,000 for a $19,000 car. I didn't figure out my mistake until I was three years into the loan. From that point on, I began making extra payments toward my car loan whenever I could. I ended up paying off the loan two years early and saved myself a lot of money in interest.

 

I've made much more responsible decisions financially since, but I'm proud of myself for turning a corner financially with that car. I've never agreed to a loan without fully scrutinizing what I was getting into and I always make myself pay extra. Who wants to pay interest anyway?

 

By the way, I still have the car. I've owned it free and clear since 2012. I've had it for over 9 years now, and my husband and I used it as our only car for a while as well. We did take out another car loan for a larger family vehicle when we had our daughter, but I handled that loan situation far better. Next month we should have that one paid off too.

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