Car Financing - Can Anyone Answer This Question?

gr8tocre8

I'm about to trade in my current car (a 2006 Mercedes S55AMG which I still owe money on) with a 2011 Mercedes S65AMG.

When I purchased my S55, the dealer told me that as long as I stay on top of my payments for at least a year, I will be able to refinance at a lower rate (at the time of purchase my credit was around 650).

It has now been 18 months since I purchased it, and I've paid every payment on time. Here's my question: Am I better off refinancing my old car FIRST, then going to the dealer to trade it in?

In other words, if I trade in my S55 with an already-existing lower interest rate, will that help me get lower interest on the new car, or does this not matter?

Thanks for any insight, I appreciate it.

kyfdx

gr8tocre8 said:

I'm about to trade in my current car (a 2006 Mercedes S55AMG which I still owe money on) with a 2011 Mercedes S65AMG.

When I purchased my S55, the dealer told me that as long as I stay on top of my payments for at least a year, I will be able to refinance at a lower rate (at the time of purchase my credit was around 650).

It has now been 18 months since I purchased it, and I've paid every payment on time. Here's my question: Am I better off refinancing my old car FIRST, then going to the dealer to trade it in?

In other words, if I trade in my S55 with an already-existing lower interest rate, will that help me get lower interest on the new car, or does this not matter?

Thanks for any insight, I appreciate it.

Your current loan's interest rate will not affect your new purchase. Refinancing would be a waste of time, and might affect your credit score.

I wouldn't put any stock in what the dealer told you, either way.

Mr_Shiftright

The dealer can compete with the loan rate you might get from your bank or CU, but he can't predict whether it's going up or down. And I agree, re-fi is not a good idea.