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How can i get finance company to slash APR?

Frequent Contributor

How can i get finance company to slash APR?

I was discharged from BK in june and i was able to finance a car which i needed to get to work its incurring about 45 dollars a month on intrest i need help trying to slash this rate its like 28% I was thinking about paying the balance around tax time because I find it ridiculous! But I needed it... Any ideas? I cant refi due to inquiries on CR I would like to build atleast some history with the car but the intrest is too crazy!

BK: 7 filed 3/31/12 - Discharged 6/27/12
Made some poor choices and life snowballed
BK: 13 filed 7/29/16 - on a 36th month time out
No CC - No Loans - Student Loans all current.
Message 1 of 7
6 REPLIES
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Regular Contributor

Re: How can i get finance company to slash APR?

I don't think you have any option other than to apply for another loan. Why would they lower the APR? They have you locked in at that rate. Your best bet will be to work on your credit score and refinance at a later time.


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Message 2 of 7
Valued Contributor

Re: How can i get finance company to slash APR?

Yup get the score up and REFI it asap.

Message 3 of 7
Valued Contributor

Re: How can i get finance company to slash APR?

Actually unless your loan is structured with some kind of prepayment penalty just putting a large payment on it around tax time will significantly reduce the interest you are paying over the life of the loan. I did this a few years ago with a Cap 1 auto loan that was at 22%. I paid down a couple thousand in one payment. Now Cap 1 came back and said "You don't need to make another payment until XX/XX/XXXX" in other words they just credited it as regular payment for the next 10 months and said I didn't need to pay again until month 11.

 

What I did instead was just keep making the regular monthly payments until the loan was finally paid off early. It saved a lot of interest on the balance paid down with the lump sum payment. Check your loan docs. If it is just a normal simple interest loan with a high interest rate this can work for you too. I won't even begin to try and figure out what interest I (or you) save but if you put all the numbers up (Current balance, interest rate, remaining term, proposed lump sum) one of the Excel geeksSmiley Tongue will quickly tell you what you save.

Best financial advice I ever got: "Just imagine what an adult would do and do that."

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Message 4 of 7
Frequent Contributor

Re: How can i get finance company to slash APR?

Thats exactly what I am going to do, because I do not want to over pay for a car for no reason. I know dropping a couple thousand kinda sucks but paying 250 a month sucks even more

BK: 7 filed 3/31/12 - Discharged 6/27/12
Made some poor choices and life snowballed
BK: 13 filed 7/29/16 - on a 36th month time out
No CC - No Loans - Student Loans all current.
Message 5 of 7
Moderator Emeritus

Re: How can i get finance company to slash APR?

I agree, pay it down as quick as you can, and keep working on cleaning your CR and building new credit.  That way next time you need a vehicle, you tell them what you want and will pay, not the other way around.  Good Luck!

Starting Score: 504
July 2013 score:
EQ FICO 819, TU08 778, EX "806 lender pull 07/26/2013
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Current scores after adding $81K in CLs and 2 new cars since July 2013
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Message 6 of 7
Frequent Contributor

Re: How can i get finance company to slash APR?

Shogun, thanks for the advice and thanks to the other that contributed. I will be more straightforward next time and I wont be so desperate. I will pay 2,500 around tax time and then pay 500 a month til it's paid in full.

BK: 7 filed 3/31/12 - Discharged 6/27/12
Made some poor choices and life snowballed
BK: 13 filed 7/29/16 - on a 36th month time out
No CC - No Loans - Student Loans all current.
Message 7 of 7