Refi after refi?

[Anonymous]

Long story short, I originally had a shark of a loan with a sky-high 22% interest rate, but it was the best I could get at the time a few years back. In April, I refi'd with Capital One and whittled down the interest from 22% to 13%. Enough to shave a few grand off of the loan, but not where I'd like to be.

Accelerate to now, and new refi options may be available. To the point where I could do a 60-month and still save money on the loan (vs. remaining terms on current loan) with almost half the payment. Is there any guidance around doing a refi soon after a refi was already done so recently, such as the age of accounts taking a massive hit? Or, do those factors only apply to revolving credit instead of installment loans? 

[Appleman]

Much will depend on what your short term goals are for yourself.

I would recommend saving money with another refinance.

You will likely have some short term negative impact. Another inquiry, another new account with a 100% balance. (Not like a maxed out credit card)

As you pay down the loan, this will improve. At 6 months the account will no longer be new. The lower payment will give you a lower debt to income level.

So, there will be a few (likely minor) credit score setbacks but many more positive outcomes from reducing the cost of your loan and having an improved cash flow.

[KLEXH25]

What rate do you think you can get? I agree with Appleman. If it makes sense financially and saves money, I think the benefits outweigh the negatives, especially if you don’t need to apply for anything new for a while. Good luck!

[Fico82]

I see you got original loan few years back . How long ago ? On a refi I would recommend that you stay with the same term example if you got roughly 48 months left or 36 etc. That way you take full advantage of the refi at the lower intrest rate . This would be the best option for you. Your savings will be greater in the long run.