My current auto loan is with Wells Fargo (21%) that is 9 months old. I just got approved with Capital One for 18%. Should I refinance or call Wells Fargo to negotiate a lower rate. Keeep in mind that I am trying to improve my credit….Any and all advice will help.
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I would call wells fargo and try to go even lower. Even 18% is very high.
If it is possible to not refinance that would be really great. Instead negotiate with WF. During that period continue to look for better rates. Make sure that everywhere you go don’t hae then pull your credit just ask them what there going rates would be for unsatisfying credit. If you need help to improve you credit this might help you a bit:
The first thing you need to do to FIX your fico. Do not try to consolidate that is just an accident waiting to happen. Here is how a fico works. There are 5 key areas for your fico score:
1: record of paying your bills on time 35%
2: Total balance on your credit cards 30%
and other loans compared to your
total credit limit.
3: Length of credit history. 15%
4: New accounts and recent 10%
applications for credit.
5. Mix of credit cards and loans 10%
Your track record in making your payments on time is 35% of your fico score. you do not need a load of money to to make payment. Just make the minimum required on time. If you mail your payments make sure you mail them 5 days before the due date. If you pay online make sure it is at least 2 days before your payment is due. Do not write past due checks < ---- this will not work.
Protect your credit history, because 15% of your score is based on how long your history is. The longer your history the higher your data points will be. The big down fall with everyone today is they think that canceling credit cards is helping them gain credit. When in fact it is hurting their credit. Canceling a card is wipeing out some important credit history. If you have to cancel and credit cards make sure that you cancel the newest ones first and save the long history. And waiting like 2 months before canceling another one, so the bureau willnot hit youall at once.
Manage your debt to credit ratio. Lets say you have a card with a 6,000 dollar limit. If you spend 3,000 dollars you now havea 50% ratio. The lower your ratio is the higher your fico will get. If your ratio is high ask your card company to raise the limit so you bring down your credit ratio. example lets say the company raise your ration to 12,000 dollars now your ratio is at 25% which isnow a lot better. Try to keep you credit ratio at 20% or less if possible, this has 30% riding on your fico score.
The other 20% of your credit is divided between new credit apps and a mix of your credit cards and loans. This is what your debt to income is. Lets face it banks would love to squeeze a quarter out of every dollar we make. Doesn't everyone? You need to establish a small debt to income ratio. Try to have smaller and less bills. This will help when applying for any loan. STAY AWAY IF ALL POSSIBLE FROM BANKRUPTSY.
I hope this helps. You can check your credit for free once a year.
if you go to http://www.annualcreditcheck.com you can review what your credit is.
Try to buy this book called the young fabulous and the broke it will help you step by step to get back on track.
Good luck pal.
If you can get a lower monthly car payment and a lower APR by refinancing with Capital One, then by all means it makes sense to do it!
It doesn’t hurt to call Wells Fargo, tell them about your offer from Capital One and see if they’ll match it…but the likelihood of that is probably pretty small.
Capital One is very reputable and known for good customer service so you certainly have nothing to fear with them.
i would!!!