Very likely: Yes. I recently checked in to auto loan rates and found I could get a loan about 1% cheaper than what the automaker was offering -- around 1.7%. None of the rates I was offered were anywhere near 5%. Unless your car is poor collateral, that is a terrible rate. I would stop giving that lender free money, look at rates here (or at Lending Tree or Bank Rate), and refinance with the cheapest lender. Use the savings from just one month to have a celebratory drink!
Is that 5% the actual interest rate on the loan or is that the Annual Percentage Rate (APR)? If you borrow $100, are you paying $5.00 in interest charges? A wise decision here will come from comparing APR's among various lenders. Don't overlook the fact that your interest rate on a used car loan will be higher than on a new car. Find an amortization table on Google and plug in your current loan amount, interest rate and number of moths left on the loan. Use the same table to figure the terms of a new loan. Your answer should be right there.
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