Overhaulin'

How can i refinance my high interest car loan with bad credit?

Wondering if anyone knows of a credit union or something who would be willing to let me refinance my car loan...I have med. to average credit score. My bank says its too low to refinance..

Public Comments

1. When you say it's too low to refinance, I assume you are referring to your credit score, and not your liquor supply. The whole purpose of credit scoring is to allow banks etc. to decide on who is or is not a good credit risk. If your score is too low, then I assume there is a reason for that. And if I'm right to this point, then inability to refinance is the consequence of poor credit. You may be placing the cart before the horse. Improving credit score is likely your best choice... which means you may not be eligible for loans until you put in some better performance. Most lending agencies will avoid lending to poor credit risks, based on past performance. Where loans are available, generally it's at a much higher rate of interest... and that's no fun. I hope I answered the question you asked. If it was actually a different question, then for 10 points, my answer to that would be ... definitely maybe depending on your horoscope and caloric intake.
2. Bad credit history = high interest fees. That's the way it is. The worse your credit history, the bigger risk you are of not repaying your loan so the more they charge to assume that risk. Nobody will look at your situation differently. Banks almost always charge lower interest rates than finance companies, so you probably have the best rate right now that you can get.
3. In addition to what others have said, "high interest rates" on relatively small loans with a relatively short repayment period (such as car loans) don't make nearly as much difference as on large ticket items with a long repayment period (such as a mortgage). For example, if you owe $10,000 on your car with an interest rate of 8% and 3 years to repay, you will be paying about $313/month. If you owe the same amount, same repayment period, with an interest rate of half that, i.e., 4% you will be paying just over $295/month. Your "savings" from the "better" interest rate is just a little over $0.50 cents per day. There are a lot easier ways to save $0.50 cents per day than by trying to refinance your vehicle when your credit score won't support a refinance. For example, drink tap water for one beverage per day rather than drinking coffee, tea, soda pop, or juice. That will save you more money than would refinancing the hypothetical vehicle in this example.