To Refinance or not to Refinance - That is the Question

[Anonymous]

I'm really lovin' this board.  There are so many good ideas and so much great advice out here that it just blows my mind.

Here's the Cliffs Notes on my Auto Refi.

I started getting serious about my credit about 2.5 years ago.  Just this week my TU crested 750 with my TU FICO at 710.  That's a long way from my scores in the 500's just a mere 2.5 years ago.

About half way through this adventure we needed a new vehicle and I wanted to add to my credit mix and payment history with an auto loan.  I was approved for several and went with Wells Fargo Dealer services which had the best interest rate of 6%.  My TU FICO was 632 at the time.  I picked up a newish 2013 Subaru Impreza Sport Wagon for 18K out the door.  Some 13 months later I have 14K left on the loan.  Payments are 363, but I pay 403 every month to help chip away at the principle a little faster.

If I could get that interest rate down in the 2.6-2.9 range I would save about $1000 over the course of the loan and drop my payments a bit, too.  This would allow to chip away at the principle faster by still paying the $403 / month.  But is it worth it?  My inquiries go up, my AAoA goes down and I have another new account killing the 5/24 rule for some of the cards I'm interested in.

What do you think?  Can my scores get me in that interest range?  If so, any recommended lenders?

Thanks in advance for your comments.

[Anonymous]

Your score should land you in 2.99 territory, easily.  Probably even lower than that with most auto lenders.

Personally, I'd say go with the refi, never mind "killing" your 5/24 or affecting you AAoA or anything like that.

The only reason I'd hesitate at all is if you need to maximize your FICO for some reason short-term - like, if you intend to pursue a mortgage soon or something along those lines. Your fast-track payoff on the auto loan, along with your overall interest saved, would outweigh any card I want, for me (saving money always trumps a new card, nobody "needs" those, we just "want" them lol)

[Appleman]

Welcome to the forums!

Up to you, but you may want to apply for PenFed. One EQ HP and good for whatever you want to apply for (minus mortgage). You could call in an talk with a customer service rep (CSR) and see what rate they could refinance you at. Plus you could apply for a CC or PLOC while you were at it.

5/24 sounds made up. Ok it's not, which Chase cards were you interested in? Apply for the Chase cards then the PenFed?

At any rate welcome and share your story!

[Studio90x]

I have heard of DCU being a great CU for refinancing as well as PenFed.

Have you looked into any local CUs and their refinancing rates as well as LTV they're willing to refinance?

[dragontears]

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@Anonymous wrote:

I'm really lovin' this board.  There are so many good ideas and so much great advice out here that it just blows my mind.

Here's the Cliffs Notes on my Auto Refi.

I started getting serious about my credit about 2.5 years ago.  Just this week my TU crested 750 with my TU FICO at 710.  That's a long way from my scores in the 500's just a mere 2.5 years ago.

About half way through this adventure we needed a new vehicle and I wanted to add to my credit mix and payment history with an auto loan.  I was approved for several and went with Wells Fargo Dealer services which had the best interest rate of 6%.  My TU FICO was 632 at the time.  I picked up a newish 2013 Subaru Impreza Sport Wagon for 18K out the door.  Some 13 months later I have 14K left on the loan.  Payments are 363, but I pay 403 every month to help chip away at the principle a little faster.

If I could get that interest rate down in the 2.6-2.9 range I would save about $1000 over the course of the loan and drop my payments a bit, too.  This would allow to chip away at the principle faster by still paying the $403 / month.  But is it worth it?  My inquiries go up, my AAoA goes down and I have another new account killing the 5/24 rule for some of the cards I'm interested in.

What do you think?  Can my scores get me in that interest range?  If so, any recommended lenders?

Thanks in advance for your comments.

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Auto loans don't count towards 5/24 only revolving credit accounts.

Are you in the market for a mortgage within the next year or so? if not I would focus on saving money on interest since that is why we all strive for good scores