If I pay off lease amount early for a car, is there any impact on my credit?
Let's say I'm paying $400/month for 36 months, which is 14,400 total. If I pay 14,400 within 6 months, are there any disadvantages on my credit?
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2Whether you can or not depends on the terms of your lease. I'd be rather surprised if the leasing company wasn't happy to receive the full amount in advance, of course.– ChrisInEdmontonOct 31, 2015 at 13:00
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what is the goal of paying it off early: to get rid of the car? to free up room so you get get a loan for another purpose?– mhoran_psprepNov 1, 2015 at 11:48
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1 Answer
In general the answer is yes, you can pay it off early. However, check the terms of your lease for a "prepayment penalty." They are becoming less common, but if you have such terms in your lease, you might incur a fee for paying early. Even then, if the prepayment penalty is less than the interest you would otherwise pay, it would still be worth it.
Paying off loans is a positive thing for your credit. It won't negatively impact your credit to prepay.
