When is the right time for a refinance on your loan?

[iNathanDrake]

Hey guys, I applied for my loan and got my first car last year in May. At the time I believe I was at a 650-660 range in my credit score. Unfortunately I walked in with a preapproved loan with Capital One, and didn't realize I was supposed to tell them NOT to run my credit cause I already had my loan and rates. They ran my credit like 7 times... Lovely. Fast forward 9 months, and here I am now sitting on a 755 credit score. 1 more year, and all of those hard pulls fall off.

My question is, if I refinance now with my now better score, it will result in another HP, another hit to my score. However; the loan amount should be better and that should balance out the difference I believe. Should I refinance now? Or wait til next year when the 7 HP's fall off? 

[dragontears]

Depends, what is the current LTV?

[iNathanDrake]

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@dragontears wrote:
Depends, what is the current LTV?

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I'm not sure what that is lol is that Loan Term Value? 

My loans for about 16k over 72 months with like a 8-9% interest rate.

[dragontears]

Sorry, LTV = loan to value; basically how much is your vehicle worth comparex to what you owe. If you are seriously underwater/upside down (i.e. loan is way more than the value of the vehicle) you will have trouble finding a bank willing to refi.

[Anonymous]

Determine what the payoff is versus the value of the car, kbb.com is a good place to find the value of the car.  If you are at 110% or less than your car is probably eligible for refinance.  Consider your current APR and what you are likely to get with your improved scores.  If you can knock a point or two off than its worth doing.  There are no fees for car refinance so its worth doing in many cases.  I went from 12.57% to 4.29% in 5 months so it saves us thousands in interest. My results are not common but it is common for folks to know a couple of percent off or eliminate a year off of their loan without having to add to their monthly payment.  Go through a credit union on DCU or Penfed.

[iNathanDrake]

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@Anonymous wrote:

Determine what the payoff is versus the value of the car, kbb.com is a good place to find the value of the car.  If you are at 110% or less than your car is probably eligible for refinance.  Consider your current APR and what you are likely to get with your improved scores.  If you can knock a point or two off than its worth doing.  There are no fees for car refinance so its worth doing in many cases.  I went from 12.57% to 4.29% in 5 months so it saves us thousands in interest. My results are not common but it is common for folks to know a couple of percent off or eliminate a year off of their loan without having to add to their monthly payment.  Go through a credit union on DCU or Penfed.

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On KBB it looks like it's valued at 13229? I might have done it wrong would you mind checking if you know better? It's a 2013 Black Nissan Altima 2.5 S sedan with 35k miles on it. Worth the refinance? 

[Anonymous]

Find out the exact payoff amount and APR as well as months left and I can give you an idea.  If I were paying 8-9% and I could cut that in half I would do it in a second.  It will probably save you 3-4k or more in intrerest over the life of the loan. Saving 3k for a few minutes and an HP is a hell of a deal.

[iNathanDrake]

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@Anonymous wrote:

Find out the exact payoff amount and APR as well as months left and I can give you an idea.  If I were paying 8-9% and I could cut that in half I would do it in a second.  It will probably save you 3-4k or more in intrerest over the life of the loan. Saving 3k for a few minutes and an HP is a hell of a deal.

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Pay off is 15,159, with interest and what not its about 18,821.