Gonna try to just list some facts here and not ramble
Bought vehicle 25k 21% APR 630/mo, absolutely robbed ik
Making payment for a year and have been adding to principle have about 20% paid off now and good credit
Applied for refi
6.29 Apr with same term – 538/mo
OR
7.29 Apr with longer term – 348/mo
Wife is pregnant due in July and will be losing her income for 3 months so leaning towards longer term for the lower payment
Thoughts?
First time posting / auto refinance
byu/Proverbs31wom inpersonalfinance
Posted by Proverbs31wom
3 Comments
Longer term will cost you more overall. If at all possible, it’s best to take the lower rate.
Babies can be expensive, but *almost everything* you need for a baby can be secondhand. If you’re smart about it, your expenses don’t need to go up much. Diapers, car seat, and any pumping supplies are about all that HAS to be new. (Yes, cloth diapers are a thing. No, you do NOT want to deal with that with a newborn.)
Take the longer term for the flexibility but pay it off as best you can.
You dont have to pay minimums, you can pay more. But the lower minimum lets you have more breathing room.
If you can afford either option and there are no prepayment penalties, take the longer term but pay as if it’s the shorter term. This way you work down the balance faster but have the flexibility to make lower payments during the peak baby costs (congratulations)