Let say if you bought a car and were paying 450 a month. A year later you want to refinance the loan could you put more $$ down and make your payments lower after you refinance?

 

Possibly, but keep in mind that lenders are not apt to extend the length of the loan (say 36 to 48 months).

Here is an idea: save for a realistic down payment. $5,000 or $10,000. I see too many car poor 350Z owners.

$450/month payments
$200/month insurance
$200/month routine maintenance and tires
Total: $850/month

 

+1

don't forget gas.

 

davidv, I don't see the $200 month in maintenance. I've found the Z very cheap to maintain and I go by the book. Including tires I'd say $50-$75 is more like it.

 

I'm looking at a 07 enthusiast and my payments are looking to be 450/month. Now insurance and all added up I can afford and still save money every month. Its just after a year I want to refinance and put more money down to lower my payments. I guess I'm just going to have to ask my lender if they allow that.

 

I just called up HSBC after my first six payments. I went from 515 to 485/ month. they just sent me paper work to sign. it was that simple. call them and ask them if you are eligible for a refinance. if you are making your payments on time, im sure they can lower your apr a bit.

 

If you have good credit, most banks or credit unions will be willing to finance a 2002 or newer vehicle for up to 72 months. Other details the bank will look at is vehicle mileage and loan to value (how much you want to borrow vs. how much the vehicle is worth). With a significant down like 10k you can easily refinance your car and lower your payments. Keep in mind though, interest rates were lower a year or two ago so you will most likely be paying a slightly higher rate. So instead of the 4.9 - 5.5% you were seeing last year, it would now be 5.9 - 6.89% under most situations. But that isn't that big of a deal.

How much would you like to lower them? Realistically, the 10k alone will drop your payment about $200/month without extending the term. Some banks even allow you to make principle payments and will adjust your payment w/out even refinancing so look into that as well.

 

Another thing you need to think about is that you will not have that $10,000 in your bank account as a cusion. If you have 10k, it really is no different to just supplement your payment out of the savings account with the 10k. Most people with payment issues want to lower their payment by extending the term because they don't have the extra cash to put down.

As far as asking your lender, it doesn't matter if they "allow" it or not. Almost all auto loans are simple interest. This means there isn't a pre-payment penalty and you can pay it off any time. The day it is paid off, the interest stops accruing. So you could take out another loan with a different lender and pay off the original loan if they wouldn't allow you to do what you wanted.

 

Thanks for the info. I'm going to talk to my lender today to get full details on the loan. Hopefully everything will go well so I can get the Z by next month.