refinancing car

[msm859]

To all the rebuilding gurus, would it be worth refinancing an auto loan charging 2.9% interest that was included in the BK and thus not reporting to a new auto loan with the credit union charging 3.9% and reporting? Principal owing is @$7500.

[JackBondLove]

Sounds like it will cost $75/yr for the pleasure of doing so.

[msm859]

Sounds like it will cost $75/yr for the pleasure of doing so.

Yes, except if I pay it off in 1 year with reducing principal it should cost @ half that. So the real question is would spending @$40 now increase my credit enough so that if I go to buy a new car in 2 years I will have a better rate then and thus save more money?

[JackBondLove]

Yes, except if I pay it off in 1 year with reducing principal it should cost @ half that. So the real question is would spending @$40 now increase my credit enough so that if I go to buy a new car in 2 years I will have a better rate then and thus save more money?

Why don't you just continue to drive the old car?

[msm859]

Why don't you just continue to drive the old car?

Good question. Everything is relative though. From 2001 - 2008 I bought 7 new cars for my wife and I. So for me to go 5 years between buying a new car is quite a stretch. Actually, only 1 time in the last 35 years have I ever gone 5 years without buying a new car. So this is the tough part for me. My credit union even told me I could go out and buy a new car if I wanted right now. So for now I am going to be more conservative, but I want to be prepared for that point in the future which for the car I drive will be in 1 year when my lease runs out.

[df04527]

Yes...but i would ask and ask several different people IF they report to the bureaus and then which ones. Not everyone reports.

[IBroke]

I guess I'd refinance simply because it would tick me off if my timely payments wouldn't be reported - especially after a BK. That reminds me of the loan I had with the buy here, pay here-lot. There were several dealers who offered a loan but I went with the one who reported to at least 2 bureaus. I think that was the minimum I deserved for paying 24% interest.

[mountanddo]

Good question. Everything is relative though. From 2001 - 2008 I bought 7 new cars for my wife and I. So for me to go 5 years between buying a new car is quite a stretch. Actually, only 1 time in the last 35 years have I ever gone 5 years without buying a new car. So this is the tough part for me. My credit union even told me I could go out and buy a new car if I wanted right now. So for now I am going to be more conservative, but I want to be prepared for that point in the future which for the car I drive will be in 1 year when my lease runs out.

7 cars in 7 years? I'd be in seventh heaven. I haven't had a new or old car for 13 years. I can't wait to get something better.

[Amy26]

I also agree ... I did the same thing. I did a ride through on a car after my BK. Rather than keeping a car with a 5 year loan that wasn't reporting at all I just bought a new one and let the old one go back. This is also an option if you can get a better deal on the interest rate with a new car rather than refinancing your existing one. Otherwise, yea sure refinance it.