Question 1

Why is the payoff amount higher than my balance?

Accepted Answer

Interest accrues every day after the last payment, and that interest must be paid too.

Question 2

How much do I save by paying off a loan early?

Accepted Answer

Roughly the interest left in the remaining payments, minus accrued interest and any penalty; here about $2,313.

Question 3

Do all loans charge prepayment penalties?

Accepted Answer

No; it depends on the contract and local law, so check the loan agreement.

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