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Is 8% a good APR for a first-time car buyer?
"My car finally died on me, so I found a Honda Civic. The loan I got was $22,000 for 72 months at 8%. My credit score is 630.
Is this is a good loan, or should I refinance ASAP?"
Eric Schad · Updated on
Reviewed by Shannon Martin, Licensed Insurance Agent.
“An interest rate of 8% on that loan is phenomenal for your credit score, especially for only 72 months.
Because you found such a great APR with your credit, refinancing shouldn’t be on your radar until you pay your loan for probably a year.
After that, take a glance at your credit score. If you’ve sprung into the low 700s, you might find a better rate, so it’s worth shopping around.
Furthermore, if you can afford it, you might also look at lowering the length of your loan to 48 months or 36 months, as this will lower the rate even more and reduce the amount of interest you’ll pay over the life of the loan.”
View full answer
- Gregory R.
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