I'm looking to refinance my 15.75% interest car loan from Capital One auto finance (done through People First the first time). I've paid the loan on time ever since inception in March of 2002. I'd like to get it refinanced at a lower rate. Should I go with People First and try and refinance the car to a lower rate? I believe that if I go with a local CU that they'll make me pay the balance down to what the car is worth today, with is probably $6000 less, and I don't think People First requires that. The only issue is that damn FICO. Me and the better half have scores in the upper 500s to low 600s and I'm not sure they'll approve on that. Any suggestions will be helpful... [Edit] Just found out that I can't refinance with People First, beacuse I already have this loan with them...does anyone have any suggestions on other sites?
We are in a similar situation. Our auto loan through Cap 1 is one year old, no lates but a killer interest rate. Our scores were similar to yours before we started here. Haven't checked them again since our first round came back. After discussing it at length, we've decided that we'd be likely to get a better rate if we wait until our scores are all well into the 600s. Good luck to you!
Regardless of which lender you go with, most have lending guidelines that only allow them to finance a certain percentage of the cars retail/resale value. In some cases the amount and percentage may even be based on wholesale/tradein values which are even lower. I think that you will typicaly find that mosts lenders that offer lower interest rates place the finance amount at 130% of the vehicles resale value! Sacrifice a few more percentage points and you may be able to get a lender to finance 150% of resale value. To be perfectly honest, it sounds like other than Peoplefirst, you may find that your only other choice would be to find a way to pay down the balance 15-20% before you try to refinance. I know you probably dont want to hear this but you can also effectively cut your current interest rate in half by paying an extra car note each month (even $100 each month would help) by writing a separate check wiht an accompanying note/endorsement to apply the extra payment to principle only instead of refinancing. This will shorten the length of time until the car is paid off which results in you paying less interest based on the shorter payoff period - effectively cutting the interest rate nearly in half. Michael
I doubt peoplefirst would give you a much lower rate on those scores. Best bet it to see if you can join a credit union in your area. Credit unions tend to have lower rates than banks. For instance, the credit union I use would refinance people with lower scores, and the highest rate to refinance a car with them is about 13% (definitely better than 19%). Those are for people with scores in the low 600s.
Peoplefirst is very hard to get approved. You could try houshold auto refinance. I refinanced my 17.9% loan to 7.5% . i had a 690 Fico.
