auto loan to pay off or not

[matthallis]

I was in the market for a 2015 honda civic this year. I had the cash to buy it outright without a loan but i decided i should get an auto loan on my credit report.

Total was about 18,000 i put down 10k and got a loan for about 8000. I have been making 1000 payments on it monthly and currently owe about 4k on it.

I was wondering is it better for me to make minimum payments and would it hurt my score if i outright payed it off in under 6 months....apr on is 5.00 and i dont want to pay anymore interest....

[Anonymous]

The Fico scoring wants to see at least one installment loan, like an auto loan.

It also wants at least 3 revolving accounts, like CCs.

If you keep the auto loan in place, it will satisfy the installment loan part, assuming you dont have any other type of installment loan going now.

Perhaps you could get the auto loan refinanced to a low rate from a place like DCU or SDFCU?

You didnt mention your CR scores, but refinancing a 2015 auto for about 8k should appeal to them, and many people on this board have reported rates like 1 to 3 per cent.

HTH

[Anonymous]

^^ I agree.

5% APR on a remaining $4,000 is nothing.  Make minimum payments on it and ride it out.  Or if you absolutely need to get the lowest APR, you can check with Penfed for a refi.  Keep in mind $4,000 may or may not be below the minimum auto loan finance amount.  If you can refi, do two or three years and set it and forget it with autopay.