Refinancing a car

[lube'd]

Can anyone explain to me exactly what happens when you refinance a car? What kind of charges do you incur besides the processing fee? I noticed on my paperwork that they have a finance charge of like 3k. What is that?

[Narcissistic]

a finance charge is what you ahve to pay for financing your car. You dont want to refinance until you've brought the payoff down a few thousand, or have a downpayment. then you go to a credit union, credit company, or your bank and take your downpayment or refinance your payoff for a lower interest rate.

like if you finance a 21k car today, and pay 13% you'll end up paying 30k. but in 6 months to a year, if you get the payoff down to 17k and refinance, you're now financing 17k instead of 21k. they'll give you a better interest rate, youre payments will go lower, and your final payment will be down to say 25k instead of 30k.

[edex]

I'm guessing payoff is principal in other terms?

[Narcissistic]

yes

[rene]

I'm guessing payoff is principal in other terms?


Payoff = Principle PLUS accrued interest for that month (in car terms, we're probably talking about $10-100 more extra for the interest per diem )

[Charlay Boy]

try going wif Farragut Financial they can help u lower your intrest rate, w/o any fees or anything with the same loan time you have left. great company

[Narcissistic]

ROFL@YOUR NAME STILL BEING PWND.

[Charlay Boy]

ROFL@YOUR NAME STILL BEING PWND.

no way to change it. so w/e lol

[tit$]

hahahahaha

[Brooklyn]

search around, you should not be paying any "processing fees".

[PIYF]

Can anyone explain to me exactly what happens when you refinance a car? What kind of charges do you incur besides the processing fee? I noticed on my paperwork that they have a finance charge of like 3k. What is that?

3k is nothing. I bought an Alero (I got owned twice the sameday the first one was buying an Oldsmobile the second was the interest rate. I was 21 and had bad credit) brand new in '01 and my Interest Rate was 14%. The car cost 21,000 and when I paid it off it cost me around 32k..

How much was the car?

[lube'd]

Well I bought the car back in like Feb 07 for like 19.9k at an int. rate of 10ish. I am now at 17.5k. I am wanting to refinance but BOA is charging me a $200 processing fee and a finance charge of nearly 3k at a 6.5 int. rate. Does this mean that I will be paying back (17.5k+3k+200) at 6.5?

[Prissy]

If you have only paid off $2,400 on your car it is pointless to refinance. Wait until you've paid off half more than that.

Right now if you try to refinance, from what you've said BOA is going to charge you $3000 in finance charges and $200 processing fees bringing your total back up to $20,700. That is more than what you took out the loan for!

Do you see the problem in this?