Haole-Pino

iTrader: (21)

Alright, I've been thinking about this the past few weeks, and I might do it.

As most of you know, My Insurance is high ($2,000 for 6 Months Full Coverage w/USAA). My STi is currently under an auto loan from a local credit union. Because they have the title of the STi, I am required to abide by there regulations and MUST have full insurance coverage on the STi untill I pay off the loan and I recieve the title. At that point, I can deside how much or little I want my coverage to be.....

Now, here's my plan to save money......
-I'm going to sign up with another credit union,
-take out a personal loan with them, for the amount to pay off my auto loan at the other credit union,
-pay off the auto loan, get the title. And close that credit union account.

At that point, now that I own the STi, I can take the full coverage off and put what I really need to save ALOT of money every month in insurance, and because the personal loan is smaller than the original amount I first started with the auto loan, my monthly loan payment will be smaller than before too....

Does this seem like a good plan? Has anyone ever done this before to save money? If so, How did it work out for you?

Thanks in advance --Dave--

Tiare

iTrader: (18)

Looks like a good plan.

I don't know how much left you have to pay off, but sometimes if it is little, you can just get away with some cash advance credit card since there is usually no interest for the first year.

If that amount is enough to cover the pay off amount, then you save $$$.

The personal loan to pay off your car loan is a good plan too.

Just make sure that whatever term your current car loan does not have any restriction on a minimum payment term, ie don't pay it off too soon.

I have been considering this method on paying off my car as well, just to lower monthly car payment and insurance.

Keep me posted if you decided to do it.

darksurfer81

iTrader: (1)

Its a good plan if the interest rate is comparable to your interest rate now. If a personal I think its "unsecured" since there is no collateral (someone correct me if im wrong) These loand usually have a higher interest rate so depending on what you are barrowing, the smaller amount could equal the same payment or even more depending on the amount you take. Thats just my understanding of the system though

808subaru

iTrader: (16)

Dave,
As you know, i used to be in the loan game.
I agree with everyone above, the rate must be close to or less than what you are currently paying. If you take out a personal unsecured loan (no collateral) you generally need great credit. These loans though are usually for $5000 or less. Most of the time loans will be taken on collateral, either with a C/D, savings or vehicle. Home loans are usually called home equity loans or home equity lines of credit, and are established with your house as collateral.
OK, so go to USAA.com and play around with quotes on your rates. I do this all the time, trying to find the best rates of coverage. IMO though, i don't think you will save a lot of money with taking full coverage off the vehicle, but maybe a bit ($75-2xx/6 months).
Hope that helps you.

Haole-Pino

iTrader: (21)

Thanks for the info bro

shaggadelic

iTrader: (26)

I think it is not smart at all. I work at a dealer and most of you knw this. a personal loan equals high interest. they don't go out as far on the term side and also the ratings are a lot tougher to get.

now lets look at some down falls.

you will no longer have gap insurance. so lets say something happens again and you get less then what you own on the personal loan? you'll be stuck paying for a car that you don't have and that will give you a bigger percentage of falling behind on the personal loan(ppls tend to think aww i don't have this car anymore i dont need to pay for it). which will screw you over in the long run.

my honest opinion would be to shop aroung for other car insurance company's. I also have USAA i'm under 25 and geico would be alot cheaper for me but usaa covers mods the reason usaa is more is b/c hawaii has not approved the new policy guideline that usaa wants to do. when hawaii approves that your insurance should drop some. i talked with them for 3hrs one day when i was ready to leave them. then they asked me if i was modded and was like as long as you have receipts/pictures they will add those items to the value of your car if anything was ever to happen. so i will stay with USAA

Haole-Pino

iTrader: (21)

I know, Same thing my father said.

Fortunately I'm in postive equity on the STi, I owe much less than local market value and KBB value.But, I know first hand about paying back a personal loan. 3 months after I crash my WRX, I finally finish paying off a personal loan for the coilovers that melted in the crash I was paying for a lump of melted metal on the H3


I did shop around for about 1 1/2 months before going to USAA.... I went from Geico ($2,800 for 6 Months) to USAA 3 months ago. USAA is my newest insurance company. They were the most affordable rate without sacrificing coverage. Plus I did hear about them covering modded cars, so I got sold!!!


thanks for the input ****

4080wrx

iTrader: (38)

i thought all lien holders require you to have full coverage as long as there is a balance?

shaggadelic

iTrader: (26)

true about the Kbb and u being positive and all but a perfect example is all those tahoes and escalades. They are taking a huge hit right now and turbo cars can be next. I can go to the auction and pick up a 2007 escalade for 11k when the sell for new @ 40k+ the values of our cars are not ideal nor predictable right now and it will not be worth the risk u are thinking about making.

808subaru

iTrader: (16)

But if he takes out an unsecured loan, he has no lien.

Haole-Pino

iTrader: (21)

**UPDATE**
After taking my fathers advice, and the advice from you fellas that responded to this tread. I desided to scrap the Personal Loan idea. I called USAA (My current insurance provider) to ask them for advice on saving money. It started with a simple question, will my premium go down later this year when I hit 25? It will, but bearly....The fella on the other line made a great suggestion.... "Well,, how bout changing your deductible on your Comprehensive, your Collision, or both. Changing your deductible (The amount you pay out of pocket if something happens) will have a hugh inpact on your total premium without sacrificing required coverage needed by your credit union.

-Currently I have a $500 deductible on both my Comprehensive & Collision

If I was to go up to $1000 for both, I would save $400 every 6 month ($800 every year!)

If I was to go up to $1500 for both, I would save $754 every 6 month ($1508every year!)

If I was to go up to $2000 for both, I would save $927 every 6 month ($1854 every year!) GOOD GOD!!!

I'm going this route instead....All that's need to figure out now is, how much am I willing to do as a deductible. How much do I trust my driving....

shaggadelic

iTrader: (26)

dave i hate to break your heart but that won't fly also.

banks require your deductable to me no more the 500/500 if you do not they have the right to force there own insurance onto your car.( which will cost more)

reason is:

lets say you hit some one and it cost a total of 6k on your car and 3k on there car. Your gonna have to pay the 500 for there no matter what since it was your fault right... and then you would have to pay 500 for your car since 500 is not that bad to get 6k of worked fixed.

Now lets look at it in the other way. lets say your at 1000/1000 now you will have to pay 1000k to fix the other car and 1000k to fix yours (the banks really) now lets say your like oh no i can't fix it since i can't afford another 1000k so now u will be driving around with 6k worth of damages.

now lets say you mess up and the bank repo's your car. and you have 6k worth of damage. they will have to lose money to fix it and get the resale value up.(which they will not want to do) so that is way they have the rule 500/500

alienbreed69

iTrader: (5)

thanks for bringing this up dave im in the same situation pretty much i just dont pay as much for my coverage....being over 35 saves you some money too...yay for being old!! lol now that you brought this to my attention ill be saving some more money myself

shaggadelic

iTrader: (26)

here is some info dave
http://www.uiecu.org/asp/products/product_8_3.asp

Haole-Pino

iTrader: (21)

Alright, Here's an update for people intrested in this tread. **** thanks for the input again, it helped me do a more intensive research. I just got off the phone with my credit union. I confirmed this with the branch manager to be sure 100%

Most banks or credit unions will NOT allow you to go higher than a $500 deductible on both your Comprehensive & Collision. Reason being, the bank or credit union wants to protect there intrest, and want to make sure in case anything happens, your able to repair the vehicle (Lower the deductible, more likely you'll get it fix). My credit union has confirm with what **** has posted.

Unlike most credit unions, my credit union "Hawaiian Tel Federal Credit Union" will allow me to do a $1000 deductible on both my Comprehensive & Collision without any problums. Anything higher, they will tag on there own insurance on top of my current insurance to protect there intrest.

So before changing your insurance deductible, please call your bank or credit union first to see what is the maxium allowed deductible.