Is Refinancing My Auto Loan Right for Me?
Unlike refinancing a mortgage loan, the process to refinance an auto loan is comparatively simple. Refinancing your car loan is worth looking into if you’re wanting to lower your interest rate and monthly payment. There are a number of reasons why refinancing your auto loan might be the best move for you. Here are some of the top reasons refinancing is right for you.
Your Finances Have Improved
If your finances or credit have improved since you originally took out the loan, you may be eligible for a lower interest rate when you refinance. Or perhaps you’ve since resolved an error on your credit report that cost you a lower rate on the initial loan. Make sure you get your free copy of your credit report from AnnualCreditReport.com and review it carefully for errors before applying for any loan. If you’ve had any updates to your credit, now would be a good time to look into refinancing.
Your Finances Have Taken a Downward Turn
Conversely, if your finances have worsened since taking out the initial loan, refinancing can still help you free up some much needed room in your monthly budget. You may still be eligible for a lower rate with a new lender. It never hurts to shop around to ensure you’re not paying more than you have to!
You Want a Better Rate
Perhaps when you initially financed the vehicle, you were in a rush to buy and weren’t able to take the time to shop around for the best rates. If you bought your car at a dealership, there’s a good chance you may have financed your vehicle through them as well. What you may not have realized at the time, is that dealer-financed auto loans often don’t get you the best deal. Or maybe you’re able to make your current payments, but want a lower rate so you can pay your loan off faster – and with less interest! As a credit union, we’re proud to offer lower rates on auto loans than traditional banks or other lenders. Visit our rates page to check out our current rates for auto loans.
The Loan Isn't Brand New
Most lenders require that you’ve had your current loan for at least 90 days before you’re eligible for refinance. This is typically so that lenders can confirm you’re making regular on-time payments on the loan, so make sure you stay on top of your payments, especially if you’re planning to refinance.
Next Steps
If any of these factors apply to you and you’re considering refinancing your loan, next you’ll need to look into the process to refinance your auto loan. Refinancing is fairly simple, there are usually little to no fees, and many lenders accept online applications. When you refinance, the new lender writes you a check to pay off the remaining balance on your old loan. Your car’s title is transferred from the old lender to the new one. Then you start making payments to your new lender at your lower interest rate.
Refinance and save with Robins Financial to drive home your savings. To find out how much you could save, give us a call or stop by one of our convenient branch locations. If you’re ready to refinance, you can apply online today.
At Robins Financial Credit Union, our mission is to enhance the financial well-being of our members and community. We honor this commitment by providing educational content to help you make the most of your finances. Read our other blog articles to help you gain the financial knowledge you need to succeed.