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Offered a lower rate to refinance. Not sure if I should bite.

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Regular Contributor

Offered a lower rate to refinance. Not sure if I should bite.

Hello,

I have my car financed through my local CU. I've had this loan since last July starting at ~$15k @ 4.74% for 72 Months. I've since paid it down to $9887.70 (Pay off amount as of today) I normally pay more then my monthly amount to lessen the time.

 

Today I called Alliant CU for a CLI on my Visa with them. They granted my CLI and then said he saw I have a auto loan and if I refinance with them, they will be able to get me 1.99% @ 48 months. My Payment amount would go up $20 a month from $220 to $240 but that is still less then I normally pay a month anyways. And the auto loan would be the same credit pull I used for my CC CLI.

 

So I called my CU to ask for the payoff amount and was offered a rate of 2.74%. I turned it down asking for the payoff amount anyway.

 

I'm now wondering if I should call my local CU back tomorrow and accept the lower rate and stay.

 

I used an interest calculator and over 4 years it would only be just over $200 in savings. But the new loan lowering my AAoA and I just paid my payment today makes me think I might be better off just staying at a 2% lower rate.

 

So not sure what to do now. Just wondering if someone that has more knowledge would offer advice.

 

Thanks

 

Message 1 of 8
7 REPLIES
Valued Member

Re: Offered a lower rate to refinance. Not sure if I should bite.

Grow a pair and stay with the CU!!

2fst4u
Message 2 of 8
Moderator Emeritus

Re: Offered a lower rate to refinance. Not sure if I should bite.

In that scenario I would ask the CU to match the offer of 1.99%    Even if they can't, I'd stay with them for 2.47%


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Message 3 of 8
Epic Contributor

Re: Offered a lower rate to refinance. Not sure if I should bite.


blackie1 wrote:

Grow a pair and stay with the CU!!


Not sure What the point of this was!?

 

Alliant is a Credit Union too (if im not mistaken, only hold a savings with them)

 

However I would call back your CU and take the 2.74% of course after trying to get them to match.

The point is make sure either current loan or new loan come down to 48 months!!!

$10k/ 48 months 1.99% = $217.00

$10k/ 48 Months 2.74% = $220.20

 

I rather try to keep local if possible!

Message 4 of 8
Regular Contributor

Re: Offered a lower rate to refinance. Not sure if I should bite.


webhopper wrote:

In that scenario I would ask the CU to match the offer of 1.99%    Even if they can't, I'd stay with them for 2.47%


 

Thanks webhopper and Creditaddict,

 

After thinking about it overnight I called my local CU today and accepted the 2.74%

 

They couldn't go lower without a credit pull. The 0.75% over 3 years if I continued to pay $300 a month would only be about 1 payment savings. I don't think it would be worth it to get a new account at this point, having to change the DMV title etc. At least with Alliant trying to get me to refi I was able to get my interest dropped by 2% without changing anything.

 

Message 5 of 8
Epic Contributor

Re: Offered a lower rate to refinance. Not sure if I should bite.


tburns wrote:

webhopper wrote:

In that scenario I would ask the CU to match the offer of 1.99%    Even if they can't, I'd stay with them for 2.47%


 

Thanks webhopper and Creditaddict,

 

After thinking about it overnight I called my local CU today and accepted the 2.74%

 

They couldn't go lower without a credit pull. The 0.75% over 3 years if I continued to pay $300 a month would only be about 1 payment savings. I don't think it would be worth it to get a new account at this point, having to change the DMV title etc. At least with Alliant trying to get me to refi I was able to get my interest dropped by 2% without changing anything.

 


over 3 years? did you drop down to 36 months or 48 months?

or how mahy months are left in current loan? sounds like you got interest deduction to the 2.74% but kept everything the same as far as how long to payoff?

Message 6 of 8
Moderator Emeritus

Re: Offered a lower rate to refinance. Not sure if I should bite.

That's great!  congrats on saving some moolah!


Starting Score: 08/29/2011 TU 671 EQ 674
Current Score: TU 754 EQ 694 EX 697
Wallet: NFCU Visa Sig 25k, Amex Lowes 22k, NavCheck 15k, Amex PRG, Amex Zync, Discover It 13.5k, Amazon Visa 5k
Platinum Spade Garden Club Member: App Free since 1/1/13. No more apps til who knows when?
MyFICO Fitness Goal: 800s Club!



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Message 7 of 8
Regular Contributor

Re: Offered a lower rate to refinance. Not sure if I should bite.

Yes, I kept everything the same. My payments are $220.83 now and I make $300 a month payments to get it paid off sooner. So if I continue to pay $300 a month with the new interest rate I should have it paid off in about 3 years.

 

 

Message 8 of 8