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Posted in Auto Loans
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Question By
Singnjudy

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I have made 3 car payments but bill was only reduced by $62.00
How to pay down principle on loan faster

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Top Contributor
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On loans, You are paying more interest

Than principal at the begining of the loan.  In fact on most loans you are paying more in interest than principal for at least the first half of the life of the loan. The want to make sure they get their money first, In most cases your first few payments will be 99% interest and 1% principal, When you get to the end of the loan it will be 99% principal and 1% interest.  

These numbers may be  slightly exagerated but they prove the point.  Welcome to the world of high finance. 

Good luck 

Top Contributor
7356 Contributions
3808 People Helped

Depends on the interest rate you are paying.  The higher the interest, the slower the pay-down will be.  If you can afford to pay a bit more every month, you should start seeing better results.

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