Extra payments reduce your loan principal faster, which means less interest accrues over time. This can help you pay off your loan sooner and save money on interest. Even small additional payments each month can make a significant difference over the life of the loan.

Biweekly payments can be beneficial because you end up making 13 full payments per year instead of 12. This extra payment each year goes directly to reducing your principal, which can shorten your loan term and save you money on interest.

Both strategies can help you pay off your loan faster and save on interest. A lump sum payment gives you an immediate reduction in principal, while extra monthly payments provide consistent progress. The best approach depends on your financial situation. If you have a large sum available, a lump sum may be more efficient, but regular extra payments can also be very effective.

Some car loans include prepayment penalties, which are fees charged if you pay off your loan early. These penalties are designed to ensure the lender collects the interest they expected. Before making extra payments, check your loan agreement or contact your lender to see if prepayment penalties apply to your loan.

This calculator provides estimates based on the information you provide. Actual results may vary slightly due to factors like rounding, exact payment dates, and potential changes to interest rates. For the most accurate information, consult your loan provider and review your specific loan terms.