Easy Equipment Finance

Blog – What is an early payment addendum? An early payment addendum for truck financing is a legal document that outlines the terms and conditions of paying off a truck loan before the end of the agreed upon loan term. This type of addendum is typically used when a borrower has the means to pay off the loan early and wishes to do so in order to save on interest charges or to improve their credit score. The addendum will outline any penalties or fees that may be associated with early repayment if there are any, as well as the process for making the early payment. It is important for borrowers to thoroughly review and understand the terms of the early payment addendum before agreeing to it.

An early payment addendum for equipment financing can have several advantages for the borrower, including:

  1. Lower interest rates: By paying off the loan early, the borrower may be able to negotiate a lower interest rate with the lender.
  2. Reduced finance charges: An early payment can result in a lower overall cost of financing, as finance charges will be reduced.
  3. Positive credit impact: Paying off a loan early can have a positive impact on the borrower’s credit score, as it demonstrates a commitment to repaying debts on time.
  4. Flexibility: An early payment addendum allows the borrower the flexibility to pay off the loan earlier than the original terms, which can be beneficial for those who want to save on interest charges or those who have the ability to pay off the loan early.
  5. Potential for additional financing: A borrower who has a history of paying off loans early may be more likely to qualify for future financing from the lender.

Early payment addendums can help a borrower by allowing them to make payments on their loan before they are officially due. This can help the borrower pay off the loan faster and potentially save money on interest charges. Additionally, making early payments can also help improve the borrower’s credit score. At Easy Equipment Finance we currently have two lenders we work with that offer early addendum financing, if this interest you schedule an appointment with me or one of my team here to discuss further.