Re: How soon is too soon to refinance an auto-loan?
08-30-2012 05:35 AM
Typically I recommend holding on to anything for at least six months:
- Everything under that is a short-term loan and may or may not have some penalties FICO wise; certainly 6 months appears to be a bump for FICO on any given tradeline
- You sorta look like a flake to every other lender who views your credit report in doing this for the next 10 years
That said, I think for car loans if the interest rate difference is such that it matters to you over six months, then refinance; however, with the paperwork involved make certain a payment doesn't get missed with BMW. Personally I wouldn't sweat a .4% difference, and I think there's some value (may just be perceived I admit) to having a diversity of lenders on one's credit report. In the Internet era, having all loans through a single financial institution really doesn't offer the same benefits it did 30 years ago.
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