Upside down help

[homesliceryry]

I have a Santander auto loan, 22.95 interest rate, 15.8 left on the loan with a total of 16 months left at 600 per month. How that adds up I couldn't tell you but anyway I'm desperate to get out of this loan, my current eq score is 627 tu 600 and ex 609. Are there any options? I plan on going for a mortgage soon but this $600 a month payment is ridiculous!! And does anyone have any car companies they can recommend for this and financing!

thanks!

[DeeBee78]

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@homesliceryry wrote:

I have a Santander auto loan, 22.95 interest rate, 15.8 left on the loan with a total of 16 months left at 600 per month. How that adds up I couldn't tell you but anyway I'm desperate to get out of this loan, my current eq score is 627 tu 600 and ex 609. Are there any options? I plan on going for a mortgage soon but this $600 a month payment is ridiculous!! And does anyone have any car companies they can recommend for this and financing!

thanks!

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That adds up, because you've got a balloon payment coming at the end of the loan. 

Have you skipped any payments? I know they allow you to skip one payment a year, but that balance is still accruing interest until the end of the loan term, when the balloon payment is due. 

[StartingOver10]

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@DeeBee78 wrote:

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@homesliceryry wrote:

I have a Santander auto loan, 22.95 interest rate, 15.8 left on the loan with a total of 16 months left at 600 per month. How that adds up I couldn't tell you but anyway I'm desperate to get out of this loan, my current eq score is 627 tu 600 and ex 609. Are there any options? I plan on going for a mortgage soon but this $600 a month payment is ridiculous!! And does anyone have any car companies they can recommend for this and financing!

thanks!

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That adds up, because you've got a balloon payment coming at the end of the loan. 

Have you skipped any payments? I know they allow you to skip one payment a year, but that balance is still accruing interest until the end of the loan term, when the balloon payment is due. 

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OP, have you figured out the value of the vehicle and the (actual) remaining balance?  Do you have extra cash in case the loan exceeds the value that the new lender will finance? That is a huge balloon:  $6200.  

Have you tried your local credit union or DCU to refi this loan?  What will be the determining factor is your income, your DTI, and the value of the vehicle. It is very likely you will need to bring in extra $$$ to get the loan refinanced. Start with your local CU's. Talk to them first to see what they can do before you let them pull credit. 

You are right - having a $600 monthly car payment may impact the amount of the mortgage you can afford as DTI is a critical factor when you go for a mortgage. 

[Anonymous]

I can't imagine the car value to loan is anything but HORRIBLE

C'mon 22.95% there is NO WAY even with a crazy amount down originally that one wouldn't be anything but upside down.

We've got to be HONEST and use our common sense
A car loan is a loan secured by property...

No different than a mortgage loan is secured by a home

How many mortgage companies will take on a loan on a piece of property worth way LESS than its value?

This is a common problem because we don't put down enough money on cars
Then add in 23% and
A deprecating asset and you're freaked

(* Homes generally appreciate, which help low down payments...And nobody pays over 20%
But with cars)
It should almost be illegal, we should just tell ppl NO, before we allow this crap to be normal....Then again ppl have to be free to choose as they please.

[Anonymous]

The loan to value is the most important issue here.  My guess is you are substantially upside down on this car loan, if that is the case you will have to put money in to get a better rate because the loan to value will need to be 110% or less most of the time. Credit unions are almost always going to be the best way to go, frankly just about anyone is better than Santander but if you don't have an acceptable loan to value ratio it will be a no go.  I suggest doing research on the payoff and the value of the car than shop for a refinance.  As your credit scores improve (assuming they do) you will have additional options.

[Anonymous]

I don't think something is adding up with this, I have never heard of Santander doing Balloon payments at the end (not how they are originated atleast) My guess would be deffered payments and or late payments would be the cause of the difference. With that being said, as other's have stated you are more than likely substantially upside-down because of that interest rate... At best, in my area you can finance up to 135% of NADA clean trade on a vehicle...with excellent credit, If credit isn't so good then lenders usually want to stay around the 100-110% LTV range. Refinancing would probably not be an option without a significant down payment, so my best advice would be to keep paying on the vehicle until paid off and just bite the bullet and pay a little extra on the note if you can in order to pay it down faster and save yourself some interest charges. I have always thought of Santander as  a doubled-edged sword, they are GREAT for helping people out in bad credit siutations and will loan to almost anyone, however they have horrible interest rates most of the time... unfortunately.

[headsup7up]

Have you thought about trying capital one for refinance?

[Anonymous]

navy fed for sure i ha e almost same scores

[DeeBee78]

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@Anonymous wrote:

I don't think something is adding up with this, I have never heard of Santander doing Balloon payments at the end (not how they are originated atleast) My guess would be deffered payments and or late payments would be the cause of the difference. With that being said, as other's have stated you are more than likely substantially upside-down because of that interest rate... At best, in my area you can finance up to 135% of NADA clean trade on a vehicle...with excellent credit, If credit isn't so good then lenders usually want to stay around the 100-110% LTV range. Refinancing would probably not be an option without a significant down payment, so my best advice would be to keep paying on the vehicle until paid off and just bite the bullet and pay a little extra on the note if you can in order to pay it down faster and save yourself some interest charges. I have always thought of Santander as  a doubled-edged sword, they are GREAT for helping people out in bad credit siutations and will loan to almost anyone, however they have horrible interest rates most of the time... unfortunately.

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If a loan is orginiated without a balloon payment in the terms, it does not stop one from being created by a missed payment, or a deferred payment, or an underpayment. Those all continue accruing interest from the time they are initiated, and they will cause a balloon payment at the end of the term, unless you are actively making additional payments to make up the difference. 

It's simple math. The amount of remaining payments OP has does not add up to the payoff, even with the interest rate as high as it is. Being upside down on the car's value is unrelated to this particular problem.

Here's some anectdotes I found for Santander online, basically confirming this to be true: 

"I have been paying on this car for 6 years and my maturity date was 2/2012. I have had 4 deferred payments, and was told I still owe over $5,000."

"... maturity date suppose to been 3/18/14, but now since i had 3 deferred payments my maturity date is 6/18/14 with $3,000 still owe on my car."