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Originally Posted by NHman
OP, another option to consider, will the lender provide the same rate at 72 months? This would put your payment (roughly) at $440. However, make the payments as if it was a 60 (or less) month loan but you have some protection if your budget is running tight in a given month.
I understand and agree with Team Plutonium's point of going with a higher payment and direct more of the money towards the principle. However I don't know your budget nor is it any of my business (to know). Assuming that you plan on keeping the M3, at the current payoff level, knowing that after 5-years, there's still a $10k balance.
Have you applied at PenFed? Great rates. Per your statement on lack of installment loan history, I don't know how much this would impact PenFed (or another credit union) from approving of a refinance.
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I am already approve for refinance with lower rates. I just need the car title to seal the deal. But I will see if BMWNA will match the refinance rate and let me keep the balloon payments.
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Originally Posted by py0413
I don't think we can be helpful in your situation. It's your life and you decide on what's more important to spend more money on. On the paper, I think the lower rate and shorter term with higher payment makes more sense. However, it really depends on how comfortable you are to stretch that extra $200/month. For some $200 is only pocket change and for some that makes night&day difference. Obviously for m3 buyers, having a car to drive for work/school isn't the only reason they choose this particular car. If you can live comfortably with the monthly payment, nothing is wrong though.
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$200 extra is not going to hurt my wallet. I can easy live comfortably with that payment. If times get hard, I still have stocks that I can sell.
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Originally Posted by Bimmr7
Not really sure what this has to do with the question. $200 a month is not chump change no matter how much you make a year. That amount can easily pay off other bills (most importantly a mortgage) or enhance quality of life in other areas. I for one love my M3 but not $200 more a month type of love.
OP if you're strongly considering paying the vehicle off in 2 years consider keeping the loan as is and put the additional payments towards the loan as planned. This way if things get tight for a month or two you can revert back to your $300 payment. Not the most economical advice but more a best of both worlds option.
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I could pay off the car now, but choose not to. Just need to build a loan history for later use. Plus that money is going to something else and the GF will kill me, if I spend it.
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Originally Posted by Smokey
Op, I think you already know the answer to your question. Under normal circumstances, I would suggest going with the lower apr, but you seemed slightly concerned about the extra $200/ month, so just keep your current payment and do as suggested above ie pay it off in 2 years, if you can. GL
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I already decide to go with lower APR rate.