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Thinking about refinancing my car
Bucketman
Call meSkraggRegistered User regular
Call meSkraggRegistered User regular
Hello helpful friends, I've been paying on my car for about three years now, but recently moved out on my own. Problem is that $430 a month it's a huge payment, so I'm thinking about refinancing. I have much better credit now then I did back then, and hopefully I can get smaller payments. I have a few questions though. Like can I do it through my original lender? I have it through Ford Motor Credit but I have no idea if I can do it through them. And if not, what is my best bet? A bank or a private lender? Any general advice?
I Appreciate any help you can give
I Appreciate any help you can give
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That being said. Fuck Bank of America. Seriously do not get a loan with them.
Some things to think about. If you can get a new loan for the same or shorter term then what you have remaining on your old loan, but with a lower interest rate. Then you can save some money. However if you take out a new loan that has a longer term, even with a lower rate you may end up paying more over all.
Its unlikely that Ford Motor will do this for you, they may lower your rate if you ask. But there is not a lot of upside for them.
Your local credit unions typically have the lowest rate. But look around at all your local banks. Just walk in and say you want to refinance your car loan. They will have a loan person to help you.
Bankrate.com has some calculators that you can plug in amounts, rates and terms into to see what your savings (costs) will be.
http://www.bankrate.com/auto.aspx
it's just a matter of finding an interest rate
this almost always can be done online
Out of curiosity, what was your interest rate, your term and how far into the term are you?
Make sure you ask them to give you a quote on a loan big enough to pay of the car, and all the extra fees, and then compare the monthlies, so it's apples to apples.
So here are some scenarios if you can get the 4% loan, depending on what term you can get. Also like MrTLicious said, be sure to factor in any fees that you will be assessed to refi.
5 years would be a payment of $217 total payments of $13,057 saving you $21 total
4 years would be a payment of $267 total payments of $12,816 saving you $262 total
3 years would be a payment of $349 total payments of $12,564 saving you $514 total
2.5 years would be a payment of $415 total payments of $12,450 saving you $628 total
2 years would be a payment of $513 total payments of $12,312 saving you $766 total
Because 4% sounds... unrealistic for a refi.
Interest rates go up on "used" cars, not down. In the eyes of the bank, your car would be used
Refinancing a loan is different from getting a new Used loan. Just a quick check of loans in my area, I could get a Used car loan for 2.74% while a refinance for a current loan is at 2.34%. There's also the matter of his credit rating. If his credit rating has improved over the years he's had the loan, he can get a better deal on it as well.