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Established Contributor
Posts: 726
Registered: ‎05-12-2012
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Refinance already?!?!

I just bought a 2012 Chevrolet Cruze Eco and received financing at a 4.89% APR. I opted to purchase GAP insurance and the price is tied into the total loan.

 

Today I called State Farm (where I have my insurance) to get the insurance switched over from my previous car to the new one and the woman asked if I would like to refinance the loan with them. Keep in mind I just bought this car last Saturday the 15th, so the loan I have for it is brand new, haven't even made a payment yet.

 

She said that they offer GAP insurance with their loans at no additional cost and APRs as low as 2.3% maybe 1.9% (of course with the right credit report)

 

My question is, is it really wise to pay off an auto loan that quickly in order to refinance with a different lender after just getting it set up?

 

Thanks for any help y'all can give.


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Moderator
Posts: 9,674
Registered: ‎01-28-2010
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Re: Refinance already?!?!

I don't think there is really much of a downside to refinancing, especially if you'll save $$$ over the life of the loan.

Your AAoA might decrease when the new loan(s) appear on your reports, but that's about it.
March2010 FICO® ~ 695 TU, 653 EQ, 697 EX
Established Contributor
Posts: 726
Registered: ‎05-12-2012
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Re: Refinance already?!?!

[ Edited ]

Thanks for the reply pizzadude

 

I've just never heard of someone turning around and refinancing immediately after being granted financing on a car. Does the original lender look down on this? Or would my other creditors see this as something unusual?


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Valued Member
Posts: 32
Registered: ‎05-25-2013
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Re: Refinance already?!?!

I don't have anything helpful to add.  Just wanted to say congrats on having such a good problem.  I hope to get stuck in pickles like this one day myself once I clean up my act!

Current Scores:                 Starting Scores:
EQ FICO 648 (7/22/14)     EQ FICO 575 (5/1/13)
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Not much change yet, but it's coming!
Established Contributor
Posts: 726
Registered: ‎05-12-2012
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Re: Refinance already?!?!


SLbaddie wrote:

I don't have anything helpful to add.  Just wanted to say congrats on having such a good problem.  I hope to get stuck in pickles like this one day myself once I clean up my act!


Thank your SLbaddie, hang in there and keep following this forum and you'll get where you want to be, remember it just takes time. I wish you the very best in your journey! :smileyhappy:


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Moderator
Posts: 9,674
Registered: ‎01-28-2010
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Re: Refinance already?!?!

If it's in your financial best interest to refinance now, then I would do it. Many people pay loans off before they are due, as long as you settle the loan in full then your lender will be fine with it.
March2010 FICO® ~ 695 TU, 653 EQ, 697 EX

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