Pay off my car loan or continue saving?

dianejsmith · Post by **dianejsmith** » Tue Nov 16, 2010 12:00 pm

so ive got about 10k in the bank so far, im trying to get to 20k by next april to put a down payment on some property. i took out a car loan about 3 years ago with a high interest(something like 15%). i owe 5780.80 with payments of 289.26 a month(220 in principal, 70 in interest). ive got about 2 more years and 3 months before its payed off. should i pay off my car loan or should i just make the minimum monthly payments and continue to save? right now im saving 1k a month and putting it into saving, if i were able to pay off the car i would be able to have 1300 a month to save.

returning_indian · Post by **returning_indian** » Tue Nov 16, 2010 12:08 pm

Paying 15% interest for car loan in US should be criminal. Pay it off. House can wait.

dbs · Post by **dbs** » Tue Nov 16, 2010 8:24 pm

Given the figures
10000 - 5800 +4(1000+300)
You would not have 20K if you pay off the loan.
If you do not pay off the loan you would have
10000+4*1000
still short of 20K.

So either way you would not have your down payment.
As for 15% intt, the previous poster has said it all.
______________________________________________________
A bank will lend you money, if you prove that you do not need it.

jackset12 · Post by **jackset12** » Tue Aug 23, 2011 4:07 am

I absolutely think that you need to look at refinancing. I am all for credit elimination, but in this case, you could possibly have more to save if you refinance. You have done well saving, and you don't want to use up that cash if you have it earmarked for something else. All in all, there are other options other than the 2 you mentioned. Most importantly, I think you try and refinance. Do you know why they gave you such a high rate?

jackset12 · Post by **jackset12** » Wed Aug 24, 2011 5:12 am

I also forgot to ask in the post above what type of other debt and debt relief plan you have in place? Is this the only debt that you have? That would be important to know if you are really considering these 2 options. Frankly, it may be better for you to do something else with that savings.

dcnri2india · Post by **dcnri2india** » Wed Aug 24, 2011 5:20 am

If this car loan is the highest APR loan then pay it off first.

Cheers

PeterGriffin · Post by **PeterGriffin** » Wed Aug 24, 2011 5:48 am

Geez.....OP posed that question about 10 months ago. Don't you think he would have decided on his plan of action by now?