Does it insinuate being completely paid? Or is it a lower amount that must be paid at a certain time? Im either confused or someone is trying to fuck me over.
In: Economics
It’s the amount to literally pay off the loan, now instead of completing the monthly payments. The amount will likely be less than payments made plus future payments because you are paying less interest by paying loan off early.
I guess it could depend on the type of loan (if it’s some weird home loan). There maybe some out there where you have to payoff a certain amount by a certain date, but I believe in general, a loan payoff is the total amount left on a loan.
I sold a house recently and we had to get the loan payoff amount from our mortgage company in order for to know exactly how much money from the sale was going to the pay off loan, and we received the remainder.
Sometimes you will see a “10-day” or “15-day” payoff. This means that 10 days from now, the amount to payoff is x. The 15 day amount will usually be a little higher than x due to the additional interest.
I think you need to provide more information. Without context it’s hard to know if someone is trying to screw you over.
I’ve seen loan payoff offers where you pay them a lump sum and you get a discount on if you had continued to pay over the life of the loan. Sometimes lenders will do that so they can get certain loans off their books. But it benefits you.
But without additional information it’s hard to know what you are talking about.
It typically means paying off a loan in full. Usually you’ll see it when a person gets a better deal on a loan for something they already have, so they “refinance” the thing. That means getting the new loan, and it “pays off” the existing loan. A “payoff amount” is confirmed from the first loan’s bank that day, meaning, if you pay me exactly this much RIGHT NOW, that loan is totally gone, including all fees and interest and everything.
A payoff is paying the entire balance.
A payment is what you’d pay on a per-month basis. There’s usually a minimum but you can pay extra if you want to pay it off quicker.
If someone is offering to pay off your loan they’re trying to:
1. Be very generous
2. Fool you and take your money
3. Or they’ll pay the balance as it stands and then you pay them as part of a new loan. If they offer to charge less interest then you might save money on a per month basis it just depends on the terms.
If you want specific advice I’d suggest telling the folks at /r/personalfinance and they can help you figure out what’s going on. But we all need more detail.
The payoff amount is the principal balance, plus any accrued interest and any pre-payment penalty.
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