What You Should Do After Paying Off Your Car
It is a good news that you have successfully made your car payment and the next thing is to think about actions that will follow. Part of those actions you need to do include checking out your insurance savings, knowing credit scores and making sure you properly your savings towards a desired goal.
Know Your Credit Report
The bitter truth is that you can have decrement in your credit score when you are able to pay off a loan. So when you are able to check your credit report, it will afford you opportunity to have details of what your credit scores and also you will be able to have confidence that your car loan information is accurate and appropriate. In a case whereby your credit scores decrease due to the your car payment, some things might have happened which include:
- In a situation whereby your remaining credit accounts is high, there is tendency that your car payment could affect your scores negatively.
- Your installment account can also determine because when you pay off your only installment loan the moment you pay off your car, it might affect your scores.
However, it is certain that there are different causes that can lead to decrement in credit score and the easier way to do that is by making sure you always check your credit reports.
Get Yourself Car Title
Congratulations that you have made car payment, what is left for you is to get the necessary documents that will affirm it. Your car title is simply a piece of paper that comprises of official owner and others that have the legal right to keep people’s property until a debt is paid – such as car. You will have to get a title for your car with your name on it which depends on the state you live at. However, if it is a case whereby you already have a title with your name at where you reside, it simply means you are in a non-title-holding state whereby the Department of Motor Vehicle in such state usually issue the title to the vehicle owner and not the lien holder. However, the lien name will be among the list of the title but not the primary name. Therefore, if you are one of those that live in such state, when you are done with your car loan payment, you can just approach your state DMV and process how they will help you remove the lien holder from your title.
In the same vein, if you are one of those that live in a title-holding state, the person that financed your loan (lien) will be able to hold the title and it will be released to you until the time you are able to satisfied the lien condition. This shows that the moment you are able to complete the loan, your lien would be satisfied and you can then proceed to receive the title or a legit document within a stipulated time. The moment you are able to receive those documents, the next thing to do follow the state’s protocol for them to help you transfer the title to your name. When you are able to do this, it will guarantee you the full ownership and afford you to sell your car in future. Just make sure you are able to complete the paperwork as at when due.
Check Different Insurance Coverage Options
The first benefit you will encounter after paying car loan is the ability to get a better rate on your car insurance. So when you paid, the next thing you need to do is to contact your insurance company and let them know you have completed your loan in order for them to remove other lien holder (lender) from your insurance policy. The process is that you will be able to carry a minimum level of insurance so that in any case of damage, the collateral and investment (the car) would be properly managed. So by the time your made car payment in full, there is no more lien holders and this will enable you to approach your insurance company and check out if it is possible to reduce your coverage or get a better rate.
You Can Save the Extra Funds