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Paying off car loan before time - does this affect credit rating?

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  • 06-08-2013 9:29pm
    #1
    CiniO
    Registered Users Posts: 16,067 ✭✭✭✭


    My wife got a small car loan in the bank few months ago.
    It's was meant to be repaid within 12 monthly instalments.
    Interest was meant to be about 8% of the loan (so whole repayment would account for 108% of the loan).

    By now, 4 instalments were repaid, and there has already been about 4% paid in interest. (which is normal as at the beginning bigger interest is charged).


    She wants to repay the loan in full now to avoid paying remaining 4% of interest (and she was told by bank earlier that she can do it).
    But she is wondering if repaying loan earlier, won't affect her future credit rating (f.e. if she ever intended to take any mortgage or something)?

    Is it better to have a loan repaid in full normally, or earlier - in term of future credit rating?
    She never had any other loan or mortgage, same as me.


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