Auto Refi or New Purchase

[erinbean28]

Hello all and thank you in advance for your advice.

My husband and I have been working diligently to get our scores up and have successfully gone from the 480s to the 600s! We have two auto loans which we both got when our credit was very bad.

Our autos and loans are as follows:

1. 2012 Toyota Camry with 70K miles on it - 14% interest rate $470 a month payment and 4 years left on the loan %17K ballance.

2. 2011 Volkswagen Tiguan with 40K miles on it - 19% interest rate $530 a month payment and 5 years left $21K ballance.

We want to relieve the financial burden of these horrendous payments, but dont want it to negatively affect our credit. We also are not planning on doing anything automobile related until our scores are in the mid 600s. So, what is the best course of action? Refi through Navy Federal CU or trade in the vehicles and get something newer (we know we are upside down on both vehicles)?

Any help is appreciated!   

[Creditaddict]

omg if you have navy federal you need to be applying NOW!

REFI REFI REFI

[trant3]

I recommend refinancing based on a 4 year term. You both will save alot of money on interest. It wouldnt make sense to trade in the vehicles since you'll end up with ALOT of negative equity applied towards the new purchase, which will probably keep your payments high.