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Question By
eaglesfn5402

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Which plan is better?
So I'm about to deploy and we want to take advantage of the tax free income. My credit score is 738 currently and I have an unsecured personal loan through sofi that's currently at $5600 with an apr of 11.5% and an auto loan of currently at 17,500 at 4.5% apr. So we want to pay off the sofi loan then either put $10,000 towards the car and give me about $4,000 for a down payment towards a truck because I'll need a vehicle upon returning from deployment or pay off the sofi loan and pay off the car completely then have $0 down for a vehicle. Which plan would be better? My thinking is it would be better to have both loans paid off to increase my credit score to get a better apr for the truck loan and have a better debt to income ratio. Paying off both loans would free up $424 a month, but by paying off the sofi loan then putting $10,000 towards the car and refinancing it would range anywhere from $150-200 extra a month and my credit score would still increase plus have the $4,000 to help keep payments stay in the price range that I want. So I guess what I'm trying to ask is which plan would be better for me getting an auto loan on a used truck in the price range of $15,000 or lower?

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Pay off both loans first. 

Not sure how how long your deployment will be,  but with both loans paid off that will free up 424 dollars a month like you say.  put that money aside and in 10 months you will have 4240 dollars. 

Questions, 

How long is your deployment?
why do you need a Truck when you get back?

why do you need a 15K truck?   Why not a 5k truck?

When you get back can you sell the car and take the money you freed up and but a nice used car and truck?

The goal is to have 0 or as little debt as you can.  ( I like 0 debt better )  You Want to Save your moneies and purchase with cash as often as you can. 

Reply by
eaglesfn5402

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My deployment is nine months. I need a truck because right now we only have one vehicle and the wife uses that for work and I just ride with my neighbor that's in the same unit as me, but he'll be gone when I get back due to ETSing. I'm honestly not sure where I came up with the 15k I was just using that as reference. I've been searching craigslist I can get a decent used truck for around $5500. So choosing to get an older used truck I don't think we'd sell her car since it's only three years old and we use it for road trips and our  main source of transportation when we go places together. So I think I'll just go with paying the car off and the unsecured personal loan then I'll have to get a loan for the truck, but a $5,500 auto loan is better than a $17,500 one. Plus by freeing up that $424 I can always pay it off quick by paying more then the allotted monthly payment and putting our tax return towards it would help too since that would be the only monthly bill besides cell phone, internet, and insurance.

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Reply by
icuhowie

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Get a Monthly Budget together,  
Live way below what you take home.

If you pay both car and loan off now,  you should be able to save up the 5500 dollars over the 9 months and Pay CASH!

Good luck and thanks for your service.

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