HI all. We bought our van in august of 2001 at 18%. I know up till now we've paid mostly intertest, we still owe 10,000 and only paid 12 for it. so, would it be better to get a personal loan to refinance at about 11%, or just pay for 3 more years since we will begin paying more on the principal now? If a get a new loan won't be be paying more interest all over again? which way would be better? thanks so much. jody
If you can get a new loan at 11% you would be crazy not to do it. That would be a huge savings over 18%. If you can get approved for the loan, do it.
If you qualify for a personal loan at 11%, you should also qualify for an auto loan at under 7-8%. Why not just refi the van? Or, if you owe more than the van is worth, take out a personal loan for just enough to pay it down to loan value, then refi the rest with the van as security. Your current loan is probably close to: 12K at 18% 4 years = 352/month if you take out a personal loan at 11% for the full amount: 10k at 11% for 3 years = 327/month you save 900 in interest assuming loan value of 8K ( should be more than that!): if you refi 8K at 8% for 3 years = 250/month and 2K at 11% for 3 years = 65/month total payment is 315/month you save 1,332 in interest -Radi8
