Can I pay my loan off early? Should I?

All loans can be paid off early. With Dealership Financing, the benefit is yours. Loans are calculated through a “simple interest” calculation so if you decide to pay the loan off early or trade the vehicle in, you would have only paid interest on the vehicle until that point, and there are no early payout fees.

Of course, you’ll need to decide for yourself if paying a loan off makes sense. First, calculate how much you’ll save by eliminating payments and interest accrued. For low-interest car loans, this amount may not add up to much.

Next, take the money you’d put into extra payments and calculate how much you could make by investing that amount in a high-yield savings account. If you could make more investing, then an early payoff may not make sense. Currently, though, interest rates on GICs, Term Deposits and savings accounts are relatively low, so keep that in mind.