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I purchased a 2007 Honda Accord brand new in 2007. Loan amount was a little over $20,000 for 75 months at 6.7%(Credit Score 690). I had just purchased a new home in 2006 at that time so my credit score took a little hit at the time I purchased my car. Monthly payments are $337.46.
Anyway, the interest rates are much better(3.2-3.7%) and credit score is 716. I have a little over 3 years left to pay off the car. I'm with Security Service Federal Credit Union. Is it worth refinancing?
What do you mean by cutting a year off? I would like a lower monthly payment, but I don't want to start all over again with the same loan terms, 75 months. I think if I cut a year off now(2 years left to pay it off) wouldn't the monthly payment be higher than what I'm paying now?
What do you mean by cutting a year off? I would like a lower monthly payment, but I don't want to start all over again with the same loan terms, 75 months. I think if I cut a year off now(2 years left to pay it off) wouldn't the monthly payment be higher than what I'm paying now?
Sorry, I'm not sure how the refinancing works.
Yes, if you can refinance it and go from 3 years to 2 years, it's worthwhile.
Otherwise, no. Right now, you are mostly paying in to principle, not interest.
Yes, if you can refinance it and go from 3 years to 2 years, it's worthwhile.
Otherwise, no. Right now, you are mostly paying in to principle, not interest.
I think I'm using the wrong online calculators because I have about $14,000.00 (3.5 years)left to pay it off. Which would be the amount I'd want to refinance. I'm currently paying $337.46. The calculators are showing that my monthly payments at 3.5 years would be a lot higher than what I'm paying now!
Are you sure you can get that type of interests rate for a used car? You also have to consider the current value of the car. If what you are refinancing is below a certain percentage, look for the rate to be more.
You have to get a full detail of a new loan before you can really compare. If a new loan is only available in 60mos, don't be afraid to go that route. Just pay an additional torward principle each month.
Are you trying to save money from your monthly payment, or are you interested in saving money in interest? If you can get a refinance loan for longer than your current term, then you'll pay less each month but you'll pay more interest in the long run. There's not much point in refinancing for a shorter term since you can just do that yourself by paying more against the principle each month.
You aren't going to want to hear this, but I would dump the car and buy one I could afford. A good
$3-4 k car, or less with no payments, will serve you just as well, and you will be able to breath a little...
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