Personal loan to payoff car loan?

[Birthritual576]

I may have asked something similar in the past but I am seriously considering it now.

I have 16k left to pay on my car loan (@ $330/m). I have been paying on it for nearly 1 1/2 years. I recently moved out and am thinking, wow, that car payment sucks. I have 9k in the bank give or take so I am thinking of trying to get a 10k loan out, pay off the car, and have 2 or 3k left over to build off of. I make less than 2k a month so this would help me save i guess. Of course I would have to pay back the 10k but I think it would be cheaper maybe or at least i would be able to pay it off faster?

Make any sense?

[Facepalm]

Unless you're 100% sure that you can pay it off faster, you're probably better off the way it is, personal loans usually have a higher interest rate than auto loan have.

[Pooka]

So you have a 16k car loan and 9k in the bank, and your goal is is be able to save more money by getting a 2nd loan at 10k to pay off the car loan with the help of your savings?

[FireStarter]

If you can afford to part with your savings, absolutely put them towards the loan. You'll already be paying less overall in interest if you get things paid off faster. As for the bank loan, if the interest rate on the bank loan is less than the car loan, absolutely get one and pay off the car loan with it. If the bank loan interest is higher than what you are paying for the car loan, just stick with the car loan. Do whatever results in paying the least in interest.

[Jerk.]

Pay off your loan. Don't get another loan.

[Lulzar]

Why would you have gotten such an expensive car? Buy what you can afford, assface.

[Facepalm]

He never said he couldn't afford it, he is just trying to get out of paying more interest than he has too.

[komokazi]

Originally Posted by Lulzar

Why would you have gotten such an expensive car? Buy what you can afford, assface.

That's not even that expensive. Besides, it's not about him not being able to afford it, as he makes 2k a month, and the payment is just 330... How is he not able to afford it? Stop being an assface, and stop riding your mom's tranny cock.

[Birthritual576]

Originally Posted by komokazi

That's not even that expensive. Besides, it's not about him not being able to afford it, as he makes 2k a month, and the payment is just 330... How is he not able to afford it? Stop being an assface, and stop riding your mom's tranny cock.

yeah i can afford it rather easily. its just a 2008 ford focus. 18k total (with 3k rebate. used it on something else though). i wanted something that would last and i always intended to pay it off sooner than what the loan was for. its just that i would rather have that money to save and now that i live on my own it will take longer to pay it off. if i can find a faster way to pay it off or a cheaper monthly payment (but not longer) i will be interested in what it is.

[Jerk.]

Originally Posted by Birthritual576

yeah i can afford it rather easily. its just a 2008 ford focus. 18k total (with 3k rebate. used it on something else though). i wanted something that would last and i always intended to pay it off sooner than what the loan was for. its just that i would rather have that money to save and now that i live on my own it will take longer to pay it off. if i can find a faster way to pay it off or a cheaper monthly payment (but not longer) i will be interested in what it is.

It depends on your contract with your finance. A lot of them will have in writing you can't shorten the loan or payments without paying an exit fee.

Your best bet is to pay your savings towards the car because it's very hard to make enough interest safely to cover the interest on the car.

[DragonKicker]

You only need to look at two things. Will they let you pay off the car in a lump sum - the answer to that is no. If they did, because they're fucked, then is the interest from the bank loan less than the interest on the car loan.

[xxNxIxGxGxExRxxJxIxMxx]

Originally Posted by DragonKicker

You only need to look at two things. Will they let you pay off the car in a lump sum - the answer to that is no. If they did, because they're fucked, then is the interest from the bank loan less than the interest on the car loan.

It is not a straight comparison between two rates in this situation. You need to also account for the rate that you will be forgoing on the savings. Even after taking into consideration this third rate, there will still be possible timing differences.