Buying a new or second-hand vehicle can be expensive. Ordinarily, they’re expensive enough that consumers resort to loans to pay them off over time. However, with car financing, buying a vehicle can be a reasonably affordable venture. If you’re thinking about paying a car loan with a credit card or you believe it is your only option, here is what you should consider.
Can I pay a car loan with a credit card?
Whether you can make a car payment with a credit card will largely depend on your auto loan lender. Some lenders will accept credit card payments without question. Other lenders may accept credit card payments but charge a hefty processing fee. If this is the case, you will have to calculate whether paying with your credit card is worth the fee. Bear in mind that many lenders do not allow direct payment by credit card.
Generally, paying off debt with credit is a no-go for more finance companies. If you can avoid paying your car loan with a credit card, you should. Before you do anything, talk to your lender to see if they accept credit card payments.
How to pay off a car loan with a credit card
First and foremost, check that your lender will accept a credit card payment. If they do, ask if there are any processing fees. If you are happy to proceed, you can transfer your auto loan balance to the card.
When paying off a car loan with a credit card, it is best to use a card with 0% interest. Often, these are introductory offers that can last from a couple of months to a couple of years. If you can finish paying off your card payments in full during that introductory period, you will not accrue or need to pay any interest on your loan’s total. Once the offer ends, you may be charged anywhere from 15 – 30% APR on the remaining balance.
Using a credit card to pay off your car loan can save you money – but only if you have a repayment plan that you stick to.
Alternative ways to pay
If you don’t have a credit card with 0% interest or you don’t have the funds to pay off the card before the offer expires, then you can look into alternative ways of paying for your vehicle.
At My Car Credit, we make the car financing process quick and hassle-free. You can apply, sign paperwork, and get approved online from the comfort of your home.
We’ll work with your financial needs, whether you have poor credit, are self-employed or have other requirements. Apply today to find out if you’ll get accepted – there’s no impact on your credit score!
Rates from 6.9% APR. Representative APR 14.9%
Evolution Funding Ltd T/A My Car Credit
Require more help?
Got a question you can’t find the answer to, or need some advice and guidance around taking out car finance? Our Car Credit Specialists are friendly, experienced, and here to help so get in touch today!