Is refinancing my auto loan just to avoid dealing with the lender that issued it a crazy idea?
I’d say No, it’s not crazy. I did that even for a mortgage, because the bank tended to lose my checks or let them sit for some days, and then claim I paid late. They were known on the internet for their poor processing department, so I decided to avoid that monthly hassle with calling and arguing, and refinanced. Compare the pain with the cost for refinancing, and if you think it’s worth it, change. You might even get a cheaper credit, and save on it. "What are the fees associated with changing the new loan? Are those fees worth the peace of mind? If so, than it is not ""crazy"".  The decision really boils down to that: is it worth the money that you will spend refinancing the loan to not have to deal with the original bank that financed your loan, assuming that you find an institution that will be more amenable to your financial expectations." "they apply it to my next payment That's what my bank did with my auto loan.  I got so far ahead that once I was able to skip a payment and use the money I would have sent the bank that month for something else.  Still, though, I kept on paying extra, and eventually it was paid off faster than ""normal"". EDIT:  what does your loan agreement say is supposed to happen to extra payments?"
"2.5%? Whoa, you are being robbed there.  Straight-up, stripped-down, and bent-over-a-table robbed. Never agree to ""fees"".  If they don't want to do the work to give you a loan, there are other lenders who do. Rarely agree to ""points"".  If you know -- and I don't mean ""think"", I mean ""know"" -- if you know that you are going to hold that loan much longer than it would take to repay those points, then maybe.  For example, if they are charging one point to lower your rate 0.25%, you want to be totally sure you will stay in the house at least four years, and probably more like six or eight years before moving or refinancing. It's more-or-less OK to pay for the appraisal.  If something goes wrong with the loan application, the appraisal will be valid for a few more months, you can try again. I once had 14% cash for a down-payment.  The loan officer said if I could come up with 15%, the rate would be reduced by 0.25%.  To get the money, I took a ""reverse point"", which paid me 1% but raised my the rate by 0.25%. The loan officer, who wasn't too bright, asked, ""Why did you do that?  The two things cancel each other out."" ""I did it,"" I explained, ""because you paid me 1% of the value of my house to sign my name twice.""" As for refinancing: Many institutions charge up-front fees when doing any type of vehicle loan. Typically this is in the neighborhood of 1% the value of the loan, with a floor of $100 (although this may vary by lender). However, for the loan the be secured by the vehicle, the principle value must be less than the collateral value. In your case, this means there is a collateral shortfall of $4,000. When working with a traditional bank, you would have two options: pay the difference up front (reducing the principle value of the loan), or obtaining a separate loan for the difference. This separate loan would often have a higher interest rate unless you have some other form of collateral to secure it with. I doubt CarMax would do a separate loan. All that being said, if you plan on selling the vehicle within the next twelves months, don't bother refinancing. It won't be worth the hassle. "I want to first state that I'm not an attorney and this is not a response that would be considered legal advice.  I'm going to assume this was a loan was made in the USA.  The OP didnt specify.   A typical auto loan has a borrower and a co-borrower or ""cosigner"".  The first signer on the contract is considered the ""primary"".  As to your question about a primary being a co-borrower my answer would be no.  Primary simply means first signer and you can't be a first signer and a co-borrower.  Both borrower and co-borrower, unless the contract specifies different, are equally responsible for the auto loan regardless if you're a borrower or a co-borrower (primary or not primary).     I'm not sure if there was a situation not specified that prompted the question.  Just remember that when you add a co-borrower their positive and negative financials are handled equally as the borrower.  So in some cases a co-borrower can make the loan not qualify.   (I worked for an auto finance company for 16 years)" "A few ideas. I suggest it would wise to consider what lesson is learned as a result of any resolution of a financial issue. Is it a lesson of responsibility and of the importance of keeping one's word, or of getting away with whatever happens (poorly planned business) with no adverse consequences. ""No"" consequences (e.g. forgiven loan) is also a consequence, and it sends a message. Sounds like paying the loan from your savings automatically means it's deducted from inheritance, since the savings are part of that inheritance. This may seem like a square deal if we ignore inflation. Assuming Today the $54K is worth much more than, unless it is adjusted for inflation, the same $54K will be worth (i.e. will allow to buy) a few decades from now, when the inheritance materializes.  So this option means your son is foregoing a significantly smaller financial loss in the future in exchange for foregoing his debt completely today. This is like borrowing $54K from a bank now, and only having to forego the same amount decades in the future when it is in fact worth much less. What borrower would not be happy with such arrangement, and what lender would do it? Only one's own loving parents :) You are in charge of what life lessons your son will walk away with from this situation. Good luck!" Just call your credit union and ask if they will let you refinance at the lower rate. If they won't, then just increase your payment every month so that your car is paid off early (in 36 months instead of 60). You won't get the lower rate, but since your loan will be paid early, you'll be saving interest anyway. "Yes, it is possible for you to refinance your existing auto loan, and so long as you can get the loan on more favorable terms (e.g.: lower interest rate), it is absolutely a smart thing to do. In fact, you would be well advised to do so as soon as possible if the car was a new car, if you refinance a NEW car soon enough you will likely still be able to get new car interest rates. Even if it is a pre-owned vehicle you shouldn't wait too long, since your car will only depreciate in value.  You will almost certainly get more favorable terms from any bank or credit union directly then you would when you go through the dealership, because the dealership is allowed to mark-up your interest rate several percentage points as profit for themselves. Your best bet would be to go to a local credit union, their rates tend to be most competitive since they are ""owned"" by their members." If you can deal with phone calls instead of a face to face meeting, for the average person with an average refinance online tools just offer another way to shop for deals. For new mortgages, I think having a person you can meet face to face will avoid problems, but for just a simple refi, online is one of the places you should check. Compete your current mortgage company, your bank (hopefully credit union), a local broker or two and the online places. The more competition you have, the more power you have in making a good choice. The answer depends on your wife's overall situation, whether you are in a community property state, and other factors. I'm assuming that since your wife paid $5,000 more for a car than it was worth, has a six-year, 25% auto loan and you talk about repossession as a routine event, that her credit history is extremely poor. If that is the case, you're unlikely to be able to refinance, particularly for more than the car is worth. You're in a bad situation, I'd look for a legal clinic at a nearby law school and find out what the law says about your situation in your state. If she has other debt, your best bet is to put the car in a garage somewhere, stop paying and demand better terms with the lender -- threaten bankruptcy. If they don't go for it, and your wife has other debt, she should look into bankruptcy. Given the usurious terms of the loan, you have a fighting chance of keeping the car in a Chapter 13. Find out and the legal implications for this before proceeding. If she doesn't have other debt, you need to figure out to get the thing repossessed on the best possible terms for you. If it's her mother's car, you're in a moral dilemma.  Bottom line, get rid of this thing asap. And make sure that going forward you are both controlling the finances.