When to refi car loan after just getting it

[Anonymous]

My husband's Civic was totaled in late December by a lady not paying attention. We had financed the Civic last February, always on time payments. His credit score was/is pretty low though due to not much other usage (only one other car we financed years prior and paid off). Side note: I'm working on getting my husband to understand why obtaining a credit card later this year would be a good thing for his scores, as long as he keeps util low and then pays off by due date.

Fast forward and we financed a newer Civic last month at 6%, which was better than even our credit union was willing to do for him and better than Cap One offered. But it's through Wells Fargo and we hate them, so we want away from them sooner than later. We'd also like to get a lower apr, of course.

My question is, when do we attempt a refi? His old loan on the totaled Civic was paid off by insurance in Feb, the new Civic was financed in Feb. The old loan shows paid in full, which of course dropped his score a bit (7 pts). The new loan through WF is not reporting, yet. Technically his first payment isn't due until March 28th, but we paid double in Feb and plan on making another payment this month (we plan on doubling or tripling payments every month 2 weeks before due date). I'm guessing WF won't report until his first payment is due?

I imagine we want to wait until WF is reporting the new loan, but how many months of on time payments should we let them report before we attempt a refi? Is there such thing as trying too soon after getting the loan?

Thanks!!

[Anonymous]

This decision should be driven by your scores not by any time frame.  6% isn't terrible given the scores you are showing below and the fact that your financing a used car which always have higher interest than new.  I would suggest you do some more rebuilding for a good 6 months, once your scores are closer to mid 600's you will be elgible for a better interest rate but right now I doubt you will accomplish anything but get a bunch of HP's and become frustrated.

I had similar scores and situation a in the summer of 2014 and had to take a 12.57% APR on a new car, worked hard on my rebuild and about 8 months later refinanced with Capital One at 8.5%, a week later I joined NFCU and was preapproved for an autoloan refinance and they gave me 4.29% over 72 months.   

I would visit the rebuilding forum, those folks can help get you on the right track, if your scores are low due to lack of use of credit then they will raise really quickly, if they are low because of collections and lates then it will take more work.  I would post as much information there as possible and let those folks guide you.  

[Anonymous]

Thank you so much! To be clear, his scores came back in the mid 600s when he applied for financing last month. He was the only one to finance, I didn't go on there as we knew my credit was worse due to a collection.

[Anonymous]

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@Anonymous wrote:
Thank you so much! To be clear, his scores came back in the mid 600s when he applied for financing last month. He was the only one to finance, I didn't go on there as we knew my credit was worse due to a collection.

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Gotcha,  I would try a credit union then like DCU or Penfed.  

[Watchmann]

My first reaction is, why bother?  You are paying it off very fast and 6% isn't that bad for a vehicle.  Whatever savings you will realize by a potential lower rate won't be that meaningful on a used car loan.  You can do the math, but your main reason for refinancing seems to be you don't like Wells Fargo.  Meh, its a loan which will be paid off soon enough.  I'd stick with it, pay it off and move on.  The effort to refinance wouldn't be worth it, imo.