it does not go by how many month u r on time—–its by ur fico score—–if u make ur car payment on time all the time it will help u trade it in or buy another one —but does not mean getting the best rate—–u have to have a good fico—-u get good fico by makeing all ur payments on time with minimal inquires and collection accounts——-do not refinance ur car —its not ahouse —they will ask for down payment—because u most likely upside down——unless u are not, so make sure u do not go for longer term more than the remaning months u have left on ur car——-just keep paying on time all accounts at least for a year—that should boost ur fico

John is technically correct with his statements that your credit score (FICO – Fair Isaac Corp Rating) is the most important determination in your interest rate. However, your question was how long do you have to pay on time and have a clean report before you can get a better rate.

That is a little bit tricky to answer not knowing all of your history, BUT the short answer is that your score is recalculated every 3 months. SO .. if you keep on doing the right things and don’t do anything to hurt your score, it should slowly creep up over time. If the only negative thing you have on your report is a few late payments and things like that (in other words, no bankruptcy or collection accounts) your score should go up substantially in 2.5 to 3 years of good behavior.

The negative information won’t be deleted off your account for 7 full years, but the way the system works is that the older the bad stuff is … the less importance it has on your credit score. If you have a late payment 5 or 6 years old, that won’t hurt your score hardly at all. What the score is looking for is evidence that you do the right things and handle your credit responsibly.

Good luck … and just keep on doing the right things .. It’ll pay off in the future. Trust me!