Investor · Baltimore, MD · Member since 2008 · 17k+ posts · 13k+ votes
10y
Paying off the car loan is the same effect as investing that money at 4.75%. Can you invest the money you would use to pay off the car loan at more than 4.75%. I sure can.
Investor · Baltimore, MD · Member since 2008 · 17k+ posts · 13k+ votes
10y
Paying off the car loan is the same effect as investing that money at 4.75%. Can you invest the money you would use to pay off the car loan at more than 4.75%. I sure can.
Investor · Dalton , GA · Member since 2015 · 63 posts · 10 votes
10y
You have a $12k car note. Sell the vechile, pay off the loan, and by a good used car at wholesale auction for half of what you owe now. A car is a liability not an assest. Treat it as such.
Hanford, CA · Member since 2013 · 5k+ posts · 1k+ votes
10y
Everyone has their own opinion. Personally I would rather buy a property and have that pay off my car loan. I did it, to buy house number 3. I crashed my car. I took the insurance money and my saving to buy house number 3. I than got the car loan for a 0% loan. So now I had $400 towards my car loan and when it was paid off in 5 years I still have the house. PLUS I am doing a cash out refinance and it is buying me house number 8.
I personally LOVE debt and leverage. in my opinion mortgages are cheap so I will leverage as much as possible.
Real Estate Investor · Houston, TX · Member since 2015 · 269 posts · 31 votes
10y
There are multiple ways to skin a cat (even though I do not condone such behavior, lol).
My personal preference is to create assets that cover my expenses. All while minimizing my expenses. What if you created another stream of income to cover your immediate expense? How much money would you save? How often would you think about that payment if you had another payment coming in to cover it?
I personally prefer to invest in notes because they pay strong returns with less headaches of the physical property.
I hope this helps.
I know - that's a bit counter-intuitive, but that's what the wealthiest people on the planet - the banksters - do. They borrow from the Fed at 0.25% or some other ridiculously low interest rate and lend to you at 3% (secured) to 29.9% (credit cards, other unsecured). How that's not a racket is beyond me.
Investor · Harker Heights, TX · Member since 2015 · 76 posts · 34 votes
10y
As mentioned already, while 4.75% isn't optimal for carrying debt (especially with so many 0% and 1.49% auto loan offers out there) it's not like outrageous. Perhaps instead of comparing it to investment opportunities, just calculate the interest you will pay in total if paid over time, if that $amount is worth it to you...continue as-is.
Penfed and DCU both offer great rates to refinance the auto if you want to go that route: 1.99% for Penfed same term, 1.49% if you reduce to 36 months. DCU 1.74%
Investor · Schenectady, NY · Member since 2015 · 107 posts · 111 votes
10y
Have you considered refinancing the car loan? When I had a car loan I did it many times. There are no closing costs so it's worth it for even a small drop in rate. A credit union should be able to do 2 or 2.5 percent.