Roll car into conventional loan

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Dear Terry,
I bought a car for my son with my credit card at a 7.9 percent interest rate. My credit union gives me 7 percent interest on a used car loan for 48 months. Will it be cheaper to keep the car on my credit card and pay it off in about 2½ years?


Dear Dee,
It may be cheaper in terms of overall interest to keep it on your credit card, but the risk is that, unlike a fixed car loan, your credit card company can change the terms of your agreement, which may raise the interest rate. Also, if you somehow miss the date of a payment, many credit cards automatically raise the interest rate.

My suggestion would be to roll the car into a conventional car loan and, if you could pay off the credit card in 2? years, get a car loan for the same term.

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