Yes, refinancing your auto loan is possible and it may allow you to save money every month and thousands over the life of the loan. If you have purchased a car in the last couple of years and did so with damaged credit, your interest rate is probably pretty high. If your financial situation has improved even a modest amount, you may be eligible to refinance that car loan and make some significant savings. Knowing your credit situation is important and any financial transaction should begin with a look at your credit report. Find errors, get the process for correcting them started as it can take some time to resolve.

There are certain parameters that lenders who do refinances operate within

  • The car must be from the last 5-7 model years
  • You must be current on the present loan
  • You must owe less than the car is worth

To determine the last bulleted item, call your current lender and ask for the payoff figure, then check many of the online sources for your vehicles current value. If you still meet the criteria, here’s how the process works. You apply with a lender for a refinance, you can do that right here, if they approve they will pay off your old auto loan and execute a new contract. Obviously, the important factor to you is the interest rate and thus the size of the payment. If they can’t lower it by at least a percentage point it will not be a big benefit, but often you can get several percentage point reductions and save a significant amount. If offered, an extension of the contract, for example from 36 to 48 months may save you additional money but will result in increased overall costs.

If you’re looking for refinancing car loans you can start right here, we have lenders who specialize in doing auto refinances. They will talk you through the process of refinancing your auto loans. Unlike the process of refinancing a mortgage, refinancing a car loan is usually accomplished in a few days and may even carry with it the additional benefit of a month without a payment.