I was taken for a ride by the Car dealer , I bought a new toyota camry , I was not prepare so I took the loan from the dealer and he gave me 6.75 APR, I have good credit. 1. What are my best refinance options now to reduce APR? 2. I will be buying a home soon will this effect my credit for my home loan ? Thanks
6.75 isnt really that bad of a rate. i am pretty sure if you thought they were taking advantage of you when you were buying the car you wouldnt have bought the car, lets say they tried to offer you 9% *% hell even 7% you probally wouldnt have gotten it. So what you have now is believe it or not fine. the difference in a point in intrest on a car loan isnt really that much. YES over the course of the loan you will save a few dollars, but it really isnt going to be much. I could understand if it was a mortage or something where a point could affect you payment a hundred dollars or more a month or 10's of thousands of dollars over the life of the loan. For you to see any real savings you would have to re-fi and get a loan below 3% and even then you are not saving that much money. Well there you go hope it helps. Also depending on the bank of credit union you re-fi with they will actually look at the Whole sale book for your "advance" (thats the dollar amount they will let you borrow based on the value of the car. the better your credit thehigher your advance). That being said if you had a deficiency balance (negative equity, upside down, flipped) in your trade then you need to see how much you have because that will play a part. If you rolled your tax and registration into the deal then that will play a role. if you purchased an extended service contract which are great to have (for long term owners) and gap and things like that then you may need to come up with some cash. What I mean is suppose the car had a sticker pric of 24000 and the invoice was 21000 the bank may say we will give you an advance of 120% of invoice so that means they will let you borrow 25200 thats it. sometimes the bank will let you borrow that plus tax plus registration, plus warrentys, plus alarms, stuff like that. So when it comes time to refi and you owe 26 or 27k but your cars value is 21k then your bank may only let you borrow 25k anyway i am starting to ramble, i hope i was able to offer some help. what ever you decide to do good luck.
1. Buy the new house first, before any inquires. 2. Remember, you are now going to be financing a used car, and will have to deal with used car rates. A credit union will probably be your best bet, although capital one has rates in the 4% range.
