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livelaughlove21's avatar

Refinancing an auto loan - in-house?

Asked by livelaughlove21 (15715points) November 3rd, 2012 from iPhone

A year ago, my husband and I got an auto loan in both of our names. It was for $8000 and, while the payments are only $223, the interest rate is 18% and it’s a 60-month loan. This is because he didn’t have a beacon score at the time and we both had extremely limited credit.

This loan is through Wells Fargo and we’d like to keep it there because we’ve been happy with them and our new mortgage is with them (3.75%). In the past year we’ve paid the loan on time and built our credit considerably, enough to get mortgage anyways, so we’re wondering if we should go to the bank and see if they can refinance it at a lower rate.

I know we we won’t be able to get a 4% rate or anything, because our credit isn’t 720+, but anything would help. What, if any, ramifications are there related to refinancing an auto loan? What would it do to our credit? Any advice is appreciated.

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2 Answers

YARNLADY's avatar

Yes, of course, ask them. If they say yes, you com out ahead, and if they say no you don’t lose anything.

We refinanced all three of our cars with a credit union and got a very low rate on them. Credit Unions are almost always lower interest than banks.

Tropical_Willie's avatar

See your original loan contract, some of the higher interest loans WILL NOT let you pay early or re-finance.

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