Credit Advice

Have a question? Have advice to share? The combined knowledge and experience of everyone in the Credit Karma community can help you. Enter your question or help others below to get started!

Question

Posted in Auto Loans
Profile Image

Question By
rsherm25

1 Contribution
0 People Helped
I have a score of 708. Credit karma says i should refinance my rate from 5.59% to 2.9%. Should i?
I have been making payments for about 7 months. If i refinance will i owe more in interest? or owe more on my total amount owed?

Your Credit Scores Should Be Free. And Now They Are.

View your scores and reports anytime.

SIGN UP NOW
All Responses

Results 1-2 of 2Results per page: 5 | 10 | 25Page 1 of 1   Previous | Next
Top Contributor
935 Contributions
132 People Helped
Most Helpful Response

Helpful to 1 out of 1 people

It depends on how your loan was written.  Although, in most cases, you are paying all interest due within your payment with a little toward the principle.   You would only owe the current months interest, no more and the total amount owed should be less based on the amounts paid on the principle.  You can contact the vendor to see what your pay off would be.   Also be sure there is no early payment penalty.   Just because Credit Karma provides an advertisment making a suggestion for refinance, you need to do your homework to see if that works for you.    In reality, if the payments are not a problem for you, you may consider a reduced loan period of the same payment with the reduced interest.  Good luck on your decision.

Reply by
rsherm25

1 Contribution
0 People Helped

In reality, if the payments are not a problem for you, you may consider a reduced loan period of the same payment with the reduced interest.  

That would be the option that i would rather due considering i dont mind the payments. Its best to call the company that is currently providing me the loan for a reduced loan period / reduced rate?

Top Contributor
935 Contributions
132 People Helped

If you can refinance with the company who holds the debt now, it can have less of a negative impact on your credit score.   If they maintain the same original information  (Date and loan amount)   You would probably still get a hard hit for an inquiry.  Your balance to to current loan amount would go higher and cause a decline.   Although your age of accounts would not change and that would be a positive.    If your loan was originally for 84 months,  the reduced interest could make it so you could finance for say 48-60 months having the same payment you do now, although more would go for the principal

Results 1-2 of 2Results per page: 5 | 10 | 25Page 1 of 1   Previous | Next

Your Credit Scores Should Be Free. And Now They Are.

View your scores and reports anytime.

SIGN UP NOW

Reply to this Question

Write your response:
Enter Your Comments

The Credit Advice pages of the Site may contain messages submitted by users over whom Credit Karma has no control. Credit Karma cannot guarantee the accuracy, integrity or quality of any such messages. Some users may post messages that are misleading, untrue or offensive. You must bear all risk associated with your use of the Credit Advice pages and should not rely on messages in making (or refraining from making) any specific financial or other decisions.