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I don't have the best credit score so I was thinking that paying off the loan will help increase my score and get better fianancing. But if paying off the loan won't increase my score that much, I was thinking it was better to use that money towards a down payment

2006-07-02 03:07:19 · 7 answers · asked by plenoptic_aeon 2 in Business & Finance Personal Finance

7 answers

Down payment for WHAT?!?!?! Another car? You need to seriously consider the cycle you're in - pay off loan, borrow for new car, pay off loan, borrow for new car... Is that where you want to be - always making a car payment and spending thousands in interest?

Try this, pay off the car loan and then put each monthly payment into your savings account for the next two or three years. Now, take the old car and your cash and buy another (newer) used car. Keep putting the monthly payment into your savings account and in another two or three years, trade up again. This way, you get to KEEP the interest and you get newer cars every couple of years.

Never, EVER buy a new car - they depreciate much too quickly.

2006-07-02 11:15:52 · answer #1 · answered by homeschoolmom 5 · 0 0

If you want to trade it in, then if you're going to get more for the trade in, then they pay off your loan for you, and you get a new car. If you want more money, you can put the car up for sale for the NADA or blue book value, and when you have a buyer and have the car sold, pay the car off with that. This way, you have 2500 you didn't risk and have more money in your hand from the sale than you would've gotten for trade-in...

2006-07-02 10:16:24 · answer #2 · answered by Mark D 3 · 0 0

Pay off your car first, and with a good credit, you can a new car.

2006-07-02 10:11:51 · answer #3 · answered by nadira456 3 · 0 0

i would pay it off, its nothing like owning something and not having to pay for it, too it will help out in the future if car places see you have paid off a car, you'll get better rates, etc....

2006-07-02 10:12:01 · answer #4 · answered by MikesLilMama 3 · 0 0

I suggest you to buy a used car with your own cash.

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2006-07-02 13:12:14 · answer #5 · answered by Anonymous · 0 0

Pay it off. That will improve your credit.

2006-07-02 10:43:02 · answer #6 · answered by rainofshadows20 3 · 0 0

DEPENDS ON WHAT THE CARS WORTH AS A TRADE IN. IF YOU CAN GET THAT OR MORE FOR IT THEN JUST TRADE IT IN AND USE THE CASH AS A DOWNPAYMENT TOO. EITHER WAY YOULL GET CREDIT FOR IT ON YOUR CREDIT REPORT.

2006-07-02 10:42:13 · answer #7 · answered by TJDAVILLE 3 · 0 0

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