Car refinancing

[kdibattista]

Has anyone refinanced a car and if so, do you have any recommendations? Also, can you get extra $$$ money back in addition to the loan amount? It would be nice to pay off a few small credit cards at the same time.

Thanks!!!

 

[kadaten]

Never heard of a cash-out refinance for cars.... probably because they lose value rather than gain like houses.... so there's no additional value for them to lend you....

I'd call your bank or credit union to see what rates they offer, and also to see if it's worth it. We called once but weren't going to save any money so they recommended we not do it...LOVE that bank for their honesty!!

 

[luvmy2sams]

We refinanced my 2002 Santa Fe several months ago through eloan. Our payment was reduced by over $100/month, and we got a great interest rate. The whole process was completed in less than a day. Eloan did such a great job with us that we used them when purchasing DH's PT Cruiser a few months later.

 

[nativetxn]

I had no idea that you could refinance car loans. Thanks for posting this!

 

[my3kids]

Peoplefirst.com,, which is now CapitalOne auto finance does refinances on automobiles. If you have a loan at 8 % or whatever you have, they will refinance(minimun of $7500, I think) and 3. something. You can greatly reduce your months of payments by paying the same amount each month at a lower rate.

 

[Desnik]

We refinanced my 2002 Camry a few months ago. We did it through DH credit union. The best part is we are saving $100 a month and they take the money every week from his check. No more lump sum to pay per month or checks to write out! It was done in 2 days and was well worth it.

 

[robsmom]

For those that have done this and had large savings ($!00 per month etc), I am curious about one thing. When you refinance to the lower rate does the timing of your loan start over. For example if you are 18 months into a 5 year loan and you refinance are you refinancing for another 5 years or the 3 1/2 years that you have left. I ask this because many people do this when they refinance a house and part of why the payments go down is that they are restarting at 30 years for mortgage that they are a few years into already.

Thanks.

 

[kadaten]

you have a choice on the term length like you do on any new loan....most of the time you have to choose a number of years...like ours only does 12, 24, 36, 48, and 60 month terms for car loans (no 1/2 years or 3.5 year loans...)....so you pick whichever you want. You can go back to the full five years to stretch your payments out and reduce the payment even more, or you can opt for the 3 or 4 year term....and reduce the monthly payment less, but end up saving more money in the long term...it depends on what's important to you....

With a house, so few people stay in them for the full term length, that it doesn't make sense to try to pay it off....so it's better for most people to stretch it back out to 30 years....they pay as little in as possible while they own the house and continue to receive tax benefits on the interest. Paying interest on an asset that only increases in value isn't a bad financial move....

Cars however, most people keep until they're paid off, and paying interest on a depreciating asset (which a car is....they never go up in value) is bad, so it makes more sense to try to pay it off as quickly as possible, and pay as little interest as possible, especially since there are no tax deductions for this interest.

 

[Microcell]

Yep, Capital One is really easy and great! You find out if you get the loan later that day. I only wish we could use for both cars, but we only have 5% on car through Community America Bank so no need to get Capital One I just think they are so great. You could look at Community America- it is a credit union.
You can check on additional amounts- they will call you after you fill out the application online if you go that route. I do not believe so because if I recall correctly with people first they will write the check to your leinholder, but you fill in the amount, maybe you could make it for more and see if the leinholder will cut you a check for the difference, but I don't know.

 

[Microcell]

Also with Capital One we had like 40 months left at 15% originally (DH had NO credit, so establishing it was very costly) and after we bought a house and his credit was all of the sudden stellar, we refinanced everything to get lower rates and we got down to 6% loan and cut it down to 36 months, cutting the loan off by four months and the payments by almost $100 dollars!

If you are not planning on moving or applying for other credit for the next six months or so, it is at least worth checking out. If you want to buy anything major though I would hold off because the inquiry will temporarily hurt your credit score, as any inquiry will.

 

[peg2001]

When we refinanced our car to get a lower interest rate, the credit union charged no fees to refinance, but did require that we take an extra $2000 on the loan. We could only do this because the car was still worth more than what we owed plus the $2000. We COULD have turned right around and put the $2000 right back on the loan but we chose instead to use the $2000 to refinance the house.

Peggy