Vehicle refinance options and question/s

[Anonymous]

Hi all once again!

Last year I financed a vehicle loan and got a TERRIBLE interest rate. 15.5%   I knew that going in and made a conscious and calculated decsion to move forward at the time due to certain other variables.   

I knew that my credit scores would be changing rather quickly and soon (and they did).  My plan was to get into the vehicle and then refinance the loan.

Today, with my scores over 700 I have many options for the refi.  However, I know that my score will continue to climb and once it breaks 720 evn better options become available to me.  The credit union that financed the vehicle is aware of this and is more than willing to work with me.  He sent me the internal credit union loan chart.  Today, they can refinance the loan at 6.25 / 6.1% depending on length of term.   Once I click into 720 and above I'm at 4.9/5.3.  Once my scores go over 740 it gets better as I'm sure you all very well know.   

My score over the next 2-3 months will be (should be) well over 720.  It's quite possible that they may get into 740...

My quesiton is: WHEN should I do this?  Now??  or wait a month or two and do it for even less?   I'm not sure I want to wait for 740 to hit though.  

Thoughts on when to pull the refinance trigger??

[CreditInspired]

Hi and welcome to myFico

IMHO, If I thought my scores would reach 720 quickly (examples: UT lowered from 90% to 29%, a Derog fell off report, a lot of inqs fell off report), then I would wait for my score to reach 720. However, if you’re talking about 3 months, I would refinance now. 

Here is is the difference in how much of your monthly payment is interest. Let’s assume the amount being refinanced is $25K. 

15.5 - $322.91

6.25 - $135.42

4.9 - $102.08

I would be jumping on that 6.25 yesterday! I would used the $188 savings to pay down the auto loan even faster. 

[Anonymous]

You'd really just have to crunch the numbers on the loan amount at different interest rates and lengths of time and see if in the end you'd wind up paying more or less overall by waiting X number of months now.

[Anonymous]

Great advice....  here's more info.

Interest rate:  15.5%

Loan amount 63K

so yea!  it's going to be a HUGE difference!

I will wait no more than 2 more payments hoping for 720 and then make the move.

[Anonymous]

Hi everyone,

My apologies for any repost.  Please disregard.

Thank you all.

[dynamicvb]

I'm not sure, but I don't think you will see anything. Your aggregate did not cross any thresholds and I'm fairly certain the aggregate holds more weight than individual cards. 

[CreditInspired]

We provided some suggestions in your post of March 12. 

https://ficoforums.myfico.com/t5/General-Credit-Topics/Vehicle-refinance-options-and-question-s/m-p/...

Your UT, unfortunately, is still way too high. IMHO, I don’t think you will see any score increase. In addition to high UT, another  problem is all your cards are reporting balances. You may see a little bump by getting all cards below 28.9%. 

But to get the biggest bump in scores, try to get two at 0% UT and one at less than 8.9% to see a sizable bump.

[Anonymous]

Ok... so I've seen a small bump just today:

Equifax:      696

Trans:        702

Experian:  711 (the only change)

That car loan is still sitting at 15.5%...  With the scores today I can get it to around 6.4%.   I think it's time to pull the trigger here and get it done.

HOWEVER, with the simulator here, if I continue to pay down my balances as I am in the next three months, it should be over 720... So?  The questions are: 1. is the simulator accurate like that and 2. What if I pay MORE than in the simulator because I typically do.

Simulator also shows that if I consolodate my revolving credit into one card, my scorse shoot into the 740s.  Again, back to faith in the simulator.

UGh!  It's such a balancing game here.  

Thoughts?

[Anonymous]

---

@Anonymous wrote:

Ok... so I've seen a small bump just today:

Equifax:      696

Trans:        702

Experian:  711 (the only change)

That car loan is still sitting at 15.5%...  With the scores today I can get it to around 6.4%.   I think it's time to pull the trigger here and get it done.

HOWEVER, with the simulator here, if I continue to pay down my balances as I am in the next three months, it should be over 720... So?  The questions are: 1. is the simulator accurate like that and 2. What if I pay MORE than in the simulator because I typically do.

Simulator also shows that if I consolodate my revolving credit into one card, my scorse shoot into the 740s.  Again, back to faith in the simulator.

UGh!  It's such a balancing game here.  

Thoughts?

---

too much faith

go ahead and refinance now, roll the savings into paying down your debt and getting your scores up and potentially refinance again if you can do a lot better.

[Anonymous]

SteelerNYC,

Ahhh... yes, Kinda my thoughts too!  Ok... thank you!!