Advice with Refinance/possible trade in

[vampireszombies]

I'm just looking for some advice on my current situation. 

In February 2014 I got my first car for 26,700 at 11.25% for 72months. With score of 675. Currently 695.

I promised myself I'd refinance 6 months later. I got edgy and tried to refinance 2 months later with DCU because I heard nothing but good things but ended up getting denied because of hardly no auto payment history. Now about to be 6 months later with perfect early payments I'm ready to refinance, but I also got the idea that if I'm going to apply for a new loan I might as well try for a different car and maybe trade in while also getting a better rate with a new car. Because of interest and the short amount of time I still owe about 25k while kbb says it's worth about 18k (crazy depreciation).

I will have about 4,000 down payment. The car I was thinking of going for is around 30k. I'm not too concerned on the monthly payment i just want more of what I'm paying to go towards the actual principal this time around. I already have some banks lined up who will refinance up to 150% of a loan, but have not applied yet. No matter what I will be trading in this vehicle for another eventually which is why I'm questioning a refinance at all. 

Am i in a situation where trading in is absolutely out of the question?

Would refinancing be better to hold off until a year later? 

If I choose to keep the car, how long till I'm no longer upside down?

What would you do?

thanks 

[04Cobra]

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@vampireszombies wrote:

I'm just looking for some advice on my current situation. 

In February 2014 I got my first car for 26,700 at 11.25% for 72months. With score of 675. Currently 695.

I promised myself I'd refinance 6 months later. I got edgy and tried to refinance 2 months later with DCU because I heard nothing but good things but ended up getting denied because of hardly no auto payment history. Now about to be 6 months later with perfect early payments I'm ready to refinance, but I also got the idea that if I'm going to apply for a new loan I might as well try for a different car and maybe trade in while also getting a better rate with a new car. Because of interest and the short amount of time I still owe about 25k while kbb says it's worth about 18k (crazy depreciation).

I will have about 4,000 down payment. The car I was thinking of going for is around 30k. I'm not too concerned on the monthly payment i just want more of what I'm paying to go towards the actual principal this time around. I already have some banks lined up who will refinance up to 150% of a loan, but have not applied yet. No matter what I will be trading in this vehicle for another eventually which is why I'm questioning a refinance at all. 

Am i in a situation where trading in is absolutely out of the question?

Would refinancing be better to hold off until a year later? 

If I choose to keep the car, how long till I'm no longer upside down?

What would you do?

thanks 

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1. Trading a vehicle in such little time may be a little difficult but not unheard of. You owe $25k and it's only worth $18k trade KBB. With the $4k you have down, you may be able to offset most of the negative equity and roll it over towards the vehicle you really want. 

2. While refinancing is a great idea, making lower payments on a car that's depreciating may put you in a bigger hole a year from now. Refinance only if you plan on keeping the car.

3. It usually takes a couple years until you are no longer upside down. If you can, making additional principal payments would certainly be up to your advantage.

4. I would start by getting an appraisal on your current vehicle and go from there. Good Luck

[clz123]

I've done this and regretted it.  It took about 10 years to break even after trading in a car I had for four months. I will never rolled negative equity again nor will I finance over 48 months.

Looks like you pay about 500/month for your current car. After paying off the 25k and rolling it up into your 30k car, you will have about a 35k to 38k loan after taxes, roughly.  now your payment is 670-728 *if* you can still gets 11.25 interest. and that is for 72 months also.  Most banks would require GAP insurance over 125% so figure that in as well. 

You stated " I'm not too concerned on the monthly payment i just want more of what I'm paying to go towards the actual principal this time around."  If that is really what you want, then pay an extra $170 a month to your loan and in a year (08/15) you will owe 18k +/- . Then you will be closer to a wash and familar with the payments. 

Just my .02 but I would caution against it.  Not as fun as a new car.