Should I Refinance?

[Eddie24CO]

Hello Everyone,

I would like some opinions and advice on whether or not I should refinance. In November 2010, I took out a used car loan through DriveTime. My Scores at the time was 524 with Experian, 544 with TU and EQ i got a really nice car for $14495 with 24.5% interest rate for 55 months, making my payment $428 per month. At that time I also had owed over $4,000 to credit cards that I previously defaulted on and other collections.

I am coming up on a year since I purchased the car, and my credit has improved drastically. My scores are currently 610 EX, 625 TU, and 625 EQ. I also have paid off everything i owed, and they now report as Paid, Closed or Paid in Settlement, and the collections have been removed/deleted with payment. 

My question is, I currently have 43 months left on the current loan, should I refiance this car through Chase or another Financial Instution in which I could get a lower interest rate for the same terms of 45-48 months?  I have calcuated it on the banks websites as a mock finance and it says that if i got a 11% interest i could pay $320 per month, almost saving $100 per month.

Is this worth it to refiannce? Thoughts?

The car loan balance is $12,500.00 and the KBB value is $6000 for trade in.

[CS800]

I'm i nthe same boat as youy. Got my car loan close to 11 months ago at 14.25%. And my scores have gone up over 100 points since I got the loan.

I know i will save a lot (about $80/month) if I get even a loan at 7% Currently owe about 12k (48 months left to go). If I get a good rate (under 5%) i would consider doing a 36 months.

It's worth it. One thing to consider is your current FICO's, they are still a bit low. But you could prob get a 14%

[cdtotten]

Anytime you are paying that kind of interest rate on a car (especially over that length of a term), then you need to refinance ASAP. The problem is that you financed a car with such horrible terms that you are already extremely upside down in the car (more than double?). Let this be a lesson for the future to never take out a car loan at that kind of interest rate, especially over a term that long.

Best advice I can give you - start saving up as much money as possible, save enough to cover the gap between the balance on the loan and the value of the car. Once you reach this point, then approach a bank about refinancing the balance. They are not going to refi a vehicle that is that far upside down.

Good luck!

[guydiver]

Way too far upside down.  The high interest rate is making the majority of your monthly payments go toward paying interest instead of paying down the principle.  In the meantime, the car depreciates even further.  As another poster stated, you need to get the amount owed on the car paid down to at least equal to the current value of the car so you can get it refinanced.  That means paying much more per month and the xtra payment applied to the principle balance.  May I ask where you got your credit scores?  I ask because no one has been able to pull their EX scores for almost two years.  Cap1 usually pulls all three bureaus.  Good luck.