Need help with loan/refinancing...

Anonymous · ‎05-14-2012

I need help with a loan I am in. What would you guys recommend, is there anything I can do to save money? When I bought the car I had 4k cash as a down payment, but the dealer I went to told me my credit was so bad that I could only get a loan at high interest. My credit was bad because of a cell phone bill I refused to pay for years, and 3 thirty day late payments on my previous car loan (which was paid off in full early, which I thought would help my credit, but didn't).

My Fico score showed as 643.

I have a loan with chase bank at 18.44% interest

The loan was originally at $11,600 for 6 years. I've paid it down to $7800.

I got the loan in January 2010 and haven't made any late payments on it. I try to pay extra into principle when I can afford it. I was hoping I could build my credit up enough to where I can refinance and save money.

The car is a 2008 mazda, 40k miles on it, and is a good machine. I don't want to trade it in or anything like that unless it saves me a boatload of money.

I know absolutely nothing about refinancing and the entire process. Is my credit score good enough to even get an interest rate low enough to justify refinancing?

Revelate · ‎05-14-2012

Yes, assuming you have no new negatives on your report and that's your actual current FICO score from one of the bureaus (caveat: this presumes your reports are all in sync between them which doesn't always happen). Judging from anecdotal evidence on this forum (check the auto loan approvals thread for more details) you can probably cut that interest rate in half which is worth re-financing.

You may run into an issue with some lenders because 7K may fall below their minimum financing line, I don't know the full details on that and it varies by lender unfortunately.

The process is simply to get a 10 day payoff quote from Chase, and take that shopping with various lenders. CU's are definitely in favor currently for good APR's on auto-loans, I'd start by reading through the recent pages of the loan approvals thread and go from there.

Anonymous · ‎05-15-2012

YOU ARE IN A GREAT POSITION TO REFINANCE YOUR CAR LOAN AND THE RATES HAVE NEVER BEEN LOWER.

BACK WHEN YOU FIRST OBTAINED YOUR CAR LOAN RATES WERE VERY HIGH

SO YOU STAND TO SAVE ALOT OF MONEY IN INTEREST CHARGES