SHOULD I REFINANCE MY AUTO LOAN?

[Anonymous]

I bought the car about 2007 my credit was really bad so financing its about 21 percent 

 my payments are 420 a month and Im am wanting to buy a house in the next few months 

I want to lower my payments to help me with dept to income but I don't want it to have a

adverse affect on my credit score 

Im wondering if it would drop my credit score and what would be other down falls of refinancing?

[Creditaddict]

Paying 21% interest can you even refi? You probably owe way more than the car is worth since so little of your payment has been going to principle... or wait... don't you have less than 12 payments to go anyway?

Refinancing would be new inq and a new account posting to your credit... probably not something I would want to do if you are looking to buy within the next 6 months.  If your not buying a house for another year, if you have cash pay off your car and then apply the $420 payments into savings for down payment for house.

[indiasnowden]

If you are upside down on your auto loan you will not be able to refi.  Live like a secluded monk, don't eat out etc; cut the cable, the cell, everything.  Tough love.  Take every penny and pay extra principal payments monthly to pay  your car off.  Take the money that you are used to paying on the car and all the extra payments to principal money that you have paid monthly on top of that and sock that away monthly until you make an offer on a home.   You will suffer a little now; live well and sleep even better later. 

That is what I was doing.  Hopefully I will close March 3rd, fingers crossed.  I found a house that I couldn't pass up so I made an offer earlier than anticipated.  But, to pay my auto loan off by year-end I am getting a second job on top of my OT.  I can take it for 10 months, breathe easy after.

Best of luck to you.

[Anonymous]

Thanks for your advice it is appreciated and a congrats is in order for the house.

I hope everything goes well for you. With the car it is being appraised for 13.500

and I owe 10.100 so I guess im starting the down hill slope. My issue with the car 

is the interest rate is about 21% and my payments are 420.00