Question Question about Refinancing a used car loan

[Zombie13]

Hey everyone!
Ok, we got some estimated refinance numbers from a credit union of which we are already members; underwriting has not contacted us with official data yet.

Current loan interest rate: 8.16%
Payoff amount: approximately $8700.00
Current payment monthly: $208.00
Remaining loan term: 48 months

Similar Offer by credit union:
48 month term
6.24%
$205.00 monthly payment
($3.00 less per month, reduction of 1.92% interest rate).

(longer term options were offered but we are not interested):
60 months, 6.24%, $169.99/month; 72 months, 6.74%, $147.00/month

This means, with a 48 month term, we would save $3.00 per month. Ooooohhh Aaaaaahhh Wooooooow. Sooooo Worth It.
So, we would save a staggering $148.00 by refinancing.

Is this really worth the effort, time, and hassle to refinance? I am not motivated to do this. LoL seriously.
Now, these are estimates but I reason, they are fairly accurate.

What do you think?
Thanks!

[shipo]

Hey everyone!
Ok, we got some estimated refinance numbers from a credit union of which we are already members; underwriting has not contacted us with official data yet.

Current loan interest rate: 8.16%
Payoff amount: approximately $8700.00
Current payment monthly: $208.00
Remaining loan term: 48 months

Similar Offer by credit union:
48 month term
6.24%
$205.00 monthly payment
($3.00 less per month, reduction of 1.92% interest rate).

(longer term options were offered but we are not interested):
60 months, 6.24%, $169.99/month; 72 months, 6.74%, $147.00/month

This means, with a 48 month term, we would save $3.00 per month. Ooooohhh Aaaaaahhh Wooooooow. Sooooo Worth It.
So, we would save a staggering $148.00 by refinancing.

Is this really worth the effort, time, and hassle to refinance? I am not motivated to do this. LoL seriously.
Now, these are estimates but I reason, they are fairly accurate.

What do you think?
Thanks!

At this point I wouldn't bother. Why? Due to A) the new loan and associated hard pull on your credit coupled with B) high(er) utilization vs. your current loan, it is highly likely your credit scores will drop by refinancing. If you were talking $50 per month, yeah, go for it, for $3 per month, nope, no way would I do that.

[Barbisi]

Well, shipo , unfortunately Zombie13 already took the hit on his score by some 20+ points, so the damage is already done.
How long will it take for his score and mine (as a co-applicant) to rebound? (He is still a little over 800 after the hard credit pull.)

[Zombie13]

At this point I wouldn't bother. Why? Due to A) the new loan and associated hard pull on your credit coupled with B) high(er) utilization vs. your current loan, it is highly likely your credit scores will drop by refinancing. If you were talking $50 per month, yeah, go for it, for $3 per month, nope, no way would I do that.

Thank you shipo. We concur. As Barbisi pointed out, this credit union did a hard pull on our credit in order to determine the interest rate. Capital One on the other hand, did not do a hard credit pull - we checked with them first. But, their offer was more like 9.3%, @ $220/month. Maybe PenFed would offer an interest rate check without a hard pull. Kinda lame that we took a hit but that's ok. It will come back. It makes sense that we would not get a spectacular interest rate, considering we have high interest rates all around.

[Johnworker1]

I refinanced my used car loan to go from 12% (bought month of discharge) to 7% after 3 months spent clearing up inaccurate items on my credit bureaus. I saved an good amount over the course of the loan and a few hundred a month. Whether it's worth it all for you to save a few dollars a month is up to you. I personally wouldn't go through all that hassle for $3.

One thing I wondered is how long have you been paying on the existing loan. Would closing that existing account to start a new one negatively affect your scores (avg time of accounts)?