Should I re-finance, purchase, or stay put????

[myesha87]

Here it goes.  I had a baby last May and I needed a new car before winter.  I was trying to buy a house and at the time I was told I didn't have enough open credit.  I wanted a luxury SUV but I wasn't making that kind of money at the time(50k) I opted to get a 2013 Kia Sorento in September 2012.  I knew that this wasn't what I wanted but I got it anyway because it was nice and I liked it.  I had a FICO score of about 550 at the time and my interest rate was 16.00%.  I agreed because I had to start somewhere, my payment is $491 and I've never been late.

Fast forward, I want to buy a house in June 2014 but I need to figure my car situation out.  My FICO score is now a 741 and I have a new job making 80k.  I was told that I shouldn't apply for anything 6 months prior to purchasing a home.  I took my report to my bank just fishing for info and they are saying they can refinance me at 2.4% but I figure if they have to pull my credit and I get dinged I may as well get a new car now or is it best to just wait until I buy my house and then make a move..........INSIGHT PLEASE!!

[Capya]

If you're content with your car, you should refinance.  If you're on a 5 year loan at 16%, and you drop your rate to 2.4%, your monthly payment will drop to somewhere around $350.  That's about $1700 a year in savings. 

You say you want to buy a house in June 2014, and that people tell you not to apply for anything 6 months prior to purchasing a home.  So... refinance before December, and it will be 6 months prior to June. The only risk in having a recent inquiry on your report when applying for a mortgage is that they will ask what it was for.  When you say that you refinanced your car to save money, they will nod their heads in understanding, and move on.

[SamsungHDTV]

I'd refinance without hesitation. 16% is too high. In my opinion, one credit pull wont make too much of a difference. Also it will help your DTI when you get ready to apply for the mortgage because your minimum payments will be less.