We’d like to remind Forumites to please avoid political debate on the Forum.
This is to keep it a safe and useful space for MoneySaving discussions. Threads that are – or become – political in nature may be removed in line with the Forum’s rules. Thank you for your understanding.
📨 Have you signed up to the Forum's new Email Digest yet? Get a selection of trending threads sent straight to your inbox daily, weekly or monthly!
The Forum now has a brand new text editor, adding a bunch of handy features to use when creating posts. Read more in our how-to guide
Car financing question?
LibertyUnites
Posts: 1 Newbie
in Loans
Loans have always confused me so I'd appreciate some help figuring out if this new opportunity is worth it...
I am making payments on two vehicles: a 2002 F-150 and my wife's 2010 Kia.
I bought the first for $18,053 a few years back and only have $6184 remaining until it's paid off. The loan I got was 60 months @ 7.74%. All told with interest the truck will cost me $21,828. Monthly payments are a little over $363.
The Kia cost $20,307 on a 72 month, 7.29% loan (with interest the total will be $25,131). We've only made 5 payments on it, so 67 remain meaning we owe around $23,386 on the car.
Now my question is, because of my military service, I am eligible to receive up to $25,000 from USAA @ a measly 2.0% interest rate. Should I take the loan in full and pay off what I can? Should I only take enough to pay off the Kia? Is doing this worth it at all?
My main concern is that in taking this new loan, am I still paying the interest (ex. the roughly $5000 in interest I will pay on the Kia after 72 months) if I pay off the auto loan? Or do I avoid that by paying it off 5 payments into the contract?
Numbers and me don't mix well so I'd appreciate any advice anyone can lend me.
I am making payments on two vehicles: a 2002 F-150 and my wife's 2010 Kia.
I bought the first for $18,053 a few years back and only have $6184 remaining until it's paid off. The loan I got was 60 months @ 7.74%. All told with interest the truck will cost me $21,828. Monthly payments are a little over $363.
The Kia cost $20,307 on a 72 month, 7.29% loan (with interest the total will be $25,131). We've only made 5 payments on it, so 67 remain meaning we owe around $23,386 on the car.
Now my question is, because of my military service, I am eligible to receive up to $25,000 from USAA @ a measly 2.0% interest rate. Should I take the loan in full and pay off what I can? Should I only take enough to pay off the Kia? Is doing this worth it at all?
My main concern is that in taking this new loan, am I still paying the interest (ex. the roughly $5000 in interest I will pay on the Kia after 72 months) if I pay off the auto loan? Or do I avoid that by paying it off 5 payments into the contract?
Numbers and me don't mix well so I'd appreciate any advice anyone can lend me.
0
Comments
-
You would be better finding a US forum as there may be different rules from UK loans and US loans.
Personally if it was me, I'd get a settlement figure to pay the Kia off, saving quite a bit of interest. The truck (its not a truck its a van!) doesn't have much longer to run so you probably won't save much by paying it off or some of it off.0
This discussion has been closed.
Confirm your email address to Create Threads and Reply
Categories
- All Categories
- 354.2K Banking & Borrowing
- 254.4K Reduce Debt & Boost Income
- 455.3K Spending & Discounts
- 247.2K Work, Benefits & Business
- 603.9K Mortgages, Homes & Bills
- 178.4K Life & Family
- 261.4K Travel & Transport
- 1.5M Hobbies & Leisure
- 16.1K Discuss & Feedback
- 37.7K Read-Only Boards