i was reading two customers' credit report. both reports are no good. customer 1 has almost maxed all his credit cards and has one car loan with the bank. recently, he bought another car and he is financing his second car with another bank.

he would like his son to take over his car loan for the first car X so that he can focus on paying off his second car Y .

after entering all information in the loans system, the interest rate for refinancing car X was 10% per year while the existing interest rate for car X was 7% per year.

i advised both father and son to reconsider their decision in refinancing car X. it is definitely not worth it. it does not make sense to refinance a car at a higher interest rate.

i printed out the future payment amounts and explained that if they plan to take the refinance option, they are paying more interest to the bank.

my colleague said sometimes customers just want to refinance so that they can pay a lower repayment amount but at a higher interest rate. i agree but i need to let them know the full implications of taking up the refinance option.

both of them are living on credit. that's the typical american life. damn stupid!!!