Auto Refi need help

[Anonymous]

I have two offers one is 36 months at 11.50% payment $417
The other is 4.74% for 60 months payment $294
I currently pay $441 17.9% started as a 73 month term I have about 53 to go

Now my problem is the lower interest rate is a longer term by 2 years so why would I take the lower rate

[StartingOver10]

Take the lower rate and any payment you make over the minimum due would go right to principal. If you set it up right, you can pay off the loan two years early.

[NewbieReed]

I would take the lower interest rate and pay extra $ every month to pay it off early. 

Why would u take the higher and pay more money!????

[MrSwiss]

if you can .. and this is just my take (probably the wrong move ) I would take the 4.47% and make the $417 payment.. Loan would be paid years sooner, you get the better rate / lower total loan cost..  You have to be diligent an make that payment ($417) if you can’t trust yourself then??? JMO I am not a financial advisor by any means..

Swiss

[Anonymous]

Thanks I was thinking the lower rate was better just scared of the extra months how do I make sure that the extra money goes to principles. What do you mean set up right? The 417 is $62 less than what I pay today

[NewbieReed]

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@MrSwiss wrote:

if you can .. and this is just my take (probably the wrong move ) I would take the 4.47% and make the $417 payment.. Loan would be paid years sooner, you get the better rate / lower total loan cost..  You have to be diligent an make that payment ($417) if you can’t trust yourself then??? JMO I am not a financial advisor by any means..

Swiss

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+1 

I just dont understand why you'd pay more each month that u have to. my car note is 387 right now and I've never made that payment. Always $400 or more. I'm dealing with a HORRIBLE interest rate right now myself. Congrats on the re-fi options! 

[Anonymous]

Thanks been paying this horrible rate since 7/2010 my payment is 441 but I've been paying $480 since the beginning. So I understand what your saying I just need to make sure I set it up tight I guess so if I pay $417 will it still take 36 months on the lower interest rate .I'm just confused not s mathmatical person at all. Can you explain it a little better please

[MrSwiss]

Newbie

I to pay $25 more on each payment should be paid for Later this yr (if i apply bonus $) or Mid-summer next year. Undecided on the use of bonus $$ to pay loan sooner... Only justification is freeing up $$ for more family things (always a good thing) and to just be done with it. Still rebuilding credit so not sure if it would hurt score being paid and not get the monthly paid as agreed posting to the credit bureau.

Swiss

[Shogun]

+1  Take the lower rate and pay extra.  Nice refinance BTW.

[Anonymous]

But how much extra to finish at a better term