Credit Score for Refi

[Nick777]

My mother in law has a car loan with Chase around 5.49% for 7 years on a Subaru Forester... I think a 2018, but the loan just started in January after her 3 year lease came up. I told her that she could refi at a better rate, possibly as low as 2.49% with a local credit union that she already has a mortgage with. Her credit is bad... I don't know how bad, but its bad. My question is - if Chase gave her a car loan, wouldn't another bank probably refi that car loan, especially a credit union?

[CH-7-Mission-Accomplished]

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@Nick777 wrote:

My mother in law has a car loan with Chase around 5.49% for 7 years on a Subaru Forester... I think a 2018, but the loan just started in January after her 3 year lease came up. I told her that she could refi at a better rate, possibly as low as 2.49% with a local credit union that she already has a mortgage with. Her credit is bad... I don't know how bad, but its bad. My question is - if Chase gave her a car loan, wouldn't another bank probably refi that car loan, especially a credit union?

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Sorry to say but 5.49% interest rate for a "bad" FICO score is a great rate.    You need to pull her credit and find out what her FICO 8's and FICO 9's are.   Most people with bad credit are paying 8% to 24% interest rates and once their scores get better they can refinance down.  

Chase is very conservative so I would bet her scores were at least okay when Chase financed her.

[Nick777]

OK, but I'm looking for an opinion on my question.

[coldfusion]

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@Nick777 wrote:

OK, but I'm looking for an opinion on my question.

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He pretty much dd, it was a gentle approach.  I'll be more blunt.

If, as you claim she has "bad" credit, which infers she has < 580 FICO 8 scores, I think she'll find it difficult to refinance a recent 84 month loan on a 3 year old car with a substantively better rate than what she got from Chase in the first place. However, you won't know if you don't try.

[4sallypat]

Try Capital One Auto Navigator with her info.

With a SP, they can tell you about how much she would qualify for a used car in a similar make/model/miiles...

This is exactly what I am going to do when my Honda lease is up later this year - Cap 1 SP will give me an idea of what re-fi a used car will give me...

Then I can decide if I want to go with the captive lender's re-fi or Cap 1 or my CU.

[CreditCrusader]

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@Nick777 wrote:

My mother in law has a car loan with Chase around 5.49% for 7 years on a Subaru Forester... I think a 2018, but the loan just started in January after her 3 year lease came up. I told her that she could refi at a better rate, possibly as low as 2.49% with a local credit union that she already has a mortgage with. Her credit is bad... I don't know how bad, but its bad. My question is - if Chase gave her a car loan, wouldn't another bank probably refi that car loan, especially a credit union?

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Based on the information you provided, we're talking a three year old vehicle...probably with 30,000+ miles...and a credit profile that is bad (which, as the other poster said, is usually sub-580).

Even with a mortgage on the books with them, you'll have difficulty getting ANYONE to finance lower than 5.49% on a used vehicle with scores that low. My advice would be to wait until the credit profile improves to refi this loan.

[Anonymous]

Sorry you will have an extremely hard time finding a better rate with bad credit.  Pretty much guaranteed a no. People need scores in the high 700s to get best rate.