What does your dad do? That's amazing, 0%

 

When you erfinance, do you have to make up any difference on the amount of the loan owed and what it lowers down to?

Like if you had a 20,000 loan and refinanced the APR and got it down to 17,000 would you be paying 3,000 to make up the difference?

i tried refinancign my last car through my credit union and they said I'd have to make up the difference. Then I spoke to some people who say they refinanced but didnt haev to make up the difference on the savings.

 

There is no "difference" to speak of. Refinancing just means putting your loan amount at a new interest rate (lower). It only really helps if you have a really high rate and are able to get a much lower rate fairly early in the loan, because you pay most of the interest up front.

In your case, you financed a certain amount, let's say $15000 (purchase price) at 10%, which comes out to $318.71/month. The moment the financing began, the total future amount of the loan became $19,122.60. In 1 year of time, you will have paid $3,824.52, but only $2,434.08 to principal. The remaining $1,390.44 will have gone straight to the bank as interest. This means you would still owe $12,565.92. If at this point, you are able to get financing for 5%, you would pay off that $12,565.92 and have it financed at 5%, but wait a minute, you've already paid for your car for 12 months, so how long do you refinance it? Do you do 5 years again, or do you keep it 5 years by doing the remaining amount for 4 years? I'll assume you refinance the payoff at 5% for 4 more years. This lowers your payment from $318.71 to $289.38 (not great) and makes your total at the end $13,890.24 for the new 4-year loan. Adding in that first year puts you at a grand total of $17,714.76, which is a savings of $1400 total. This isn't bad, but rarely can you refi for half the original rate, and the longer you go past 1 year, the less useful it becomes.




This means that you no longer owe just the price of your car, but also the interest. If you refinance, then you owe whatever the "payoff" price is to the lender. This amount can be found out by asking your bank, or in my case, I just go to the website and look at my daily payoff amount (it goes up a little daily then goes down after each monthly payment). Upon refinancing, you would be taking this amount

 

2005 GSR
$16,000 down (trade in)
$326/mon. 60months
don't know what that ssl thing is...

 

Wow, ok. You laid that out so nicely. Thank you, sir. :]

 

At the end of the day, it's of little consequence what other people are paying.

Know your facts & figures before you start negotiating (use www.edmunds.com or similar) and see where the deal comes out.......you can either afford it, or you can't. Don't end up badly in debt for a rapidly depreciating "asset".

 

$500 down
4.4% apr/ 84 months
443/month
putting 10k down on the car at the end of this tho so it will be paid off early

 

If you know what other people are paying, you can confront the guy and say, "I have good credit, I want to buy this car. My friend bought his for XX,XXX dollars, and I will buy it from you if you match that price."

 

Westside: That's why I'm doing this.

MTM. A mitsubishi is worth it to me. I won't put myself into debt though. I've calculated possible payments and would still have a G left over every month, or a little under a G after all my bills. Rent, Car, Insurance, Phone.

Evoland: I didn't know you can go up to 84 months. Holy smokes. How did you pull that off? Is it easier to get longer finance options than shorter. Or is it harder to get 84 months?

 

Don't even ask...7 years is absolutely retarded for a car. 4 years used to be the standard, then only recently did 5 years become normal. 7 years is obscene.

 

i got the '03 for $28K incl fees ($1500 under invoice). the difference is the interest charged for financing if i were to make all my payments.

 

highly unlikely that a BK is in the picture. besides, my wife makes 3x more than i do so everything does get paid on time including the $960/month for rent on our apt, & the $5k in baby stuff she has purchased with cash in the last 3 months. not only that, we are looking at $400-500k homes in Miami, FL & even with all the debt, we still qualify for a home up to $750k.

i will allow you to think you know alot about car financing but you know everything. at any time i can fax you copies of the loan docs to show you my #'s are dead nuts correct. also keep in mind i'm not complaining about my car pymts. they fit within the budget alotted. my budget allows for a single car pymt of $1500/month not including insurance.

 

Put down $12,000 cash...
60 months at 6%
$379.00 a month

 

What you are saying is making less sense with every post. Don't you have other assets to protect?

 

less sense in what way?

all of my valuable assets are liquid.