Was wondering my chances of getting my auto loan refinanced with my current credit. Below is my current situation.
Current loan with Capital One, 3 months old, Payoff is 37,174 at a 8.99% rate.
Current FICO8 is 653 (Experian)
1 Paid Collection
2 Paid Charge-offs
I was pre-approved (soft pull) from AutoPay for 5.44% over 78 months. I realize they are not an actual lender and would simply submit my info to actual lenders should I proceed with the actual application. Is this worth it?
Any advice on this?
hmmm what are the term of the current loan? also 78 months? How much are your monthly payments now? around $650?
Soo what I recently started doing with capital one was making bi-weekly payments and sending additional payment for the principal. Long story short, is like making 13 monthly payments instead of 12 a year. You end up paying the loan faster and end up paying less interest.
Assuming my above assumptions are correct, making the bi weakly payments of $349.84 (includes additional $50 a month for principal) you will pay your current loan in 5 years and 2 months Vs 6.5 years, save $2136 on interest and it would be equivalent to refinancing at 7.43%. Still not as low as 5.44% but at least its more than 1.5% in savings. Like you mentioned, that 5.44% may vary once they pull the actual credit.
I didn't say I was refinancing because I couldn't afford it. I can afford the payments no problem. I am simply looking into saving interest. I could go as far to say my first mistake was letting my credit get bad in the first place to have to get a 9% loan. Anyhow to the previous poster, yes you are correct my payments are 660$. I have actually been paying 700$ each month (for the past 3 months) on the loan to pay more towards the principal. I like your method and makes sense to paying less interest over the life of the loan. Based on feedback so far I think I may keep doing this for another 4-6 months and then look into refinancing again
Make sure the additional $40 are being applied to principal only. Sending $700 and not telling them how to apply it can be an issue. They might apply the payment to accrued interest before applying it to the principal.... I pay via the cap one app and make 2 payments (1 regular the other principal only)... hope this helps and/or makes sense.