Interest rates are at one of the lowest points they have been in years, often times this leads people to wonder if they should refinance. However, most people think only of their homes when considering refinancing, but getting an auto loan refinance can save you thousands of dollars by the end of your loan term.
For example, if you bought a vehicle six months ago and did not have the best credit score, you are usually hit with about an 11% APR on a five year auto loan. If the loan amount was approximately $23,000, then your monthly payment would be about $500.
However, if you seek refinancing through an online lender like myAutoLoan.com and find they offer auto loan refinance with lower interest rates, you could refinance the balance of your loan and find yourself with a new payment of about $400 a month. This would save you almost $6,000 by the time you paid the loan off and have an extra $100 a month to pay off other bills.
Looking for online lenders who offer auto loan refinance like myAutoLoans.com may garner even more dramatic results. Some new car buyers are dealing with interest rates of 16-19% and can save significant amounts of money by refinancing their car loan.
Another great reason to seek out auto refinancing is if you have improved your credit score since the time you started your car loan. Individuals with poor or insufficient credit scores often end up with exorbitant interest rates. However, by improving your credit score and getting an auto loan refinance with myAutoLoan.com, you can reduce your monthly payment and save money on the life of the loan by qualifying for lower interest rates.
If this has you considering whether auto loan refinancing is the right step for you, there are a few other things to keep in mind.
What is Auto Loan Refinance?
An auto refinancing loan pays off your existing car loan in place of a new loan. Your current auto title and loan balance is transferred to the new lender and once the paperwork is complete, you make your car payments to the new lender.
Car Dealership Loans
If you bought your car from a dealership, the chances are you did not walk away with the best interest rate you could have gotten through a place like myAutoLoan.com.
If you have an upside-down loan is basically means that your car is not worth what you still owe on it. An auto refinancing loan can correct this problem, which would allow you to trade it in for a new car or sell it for what it is actually worth, if desired.
If your interest rate is higher on your existing loan than what you could get through a lender like myAutoLoan.com, you should consider refinancing your vehicle. Rates may have fallen since you first got your loan, your credit score may have improved or your rate was higher than average to begin with, especially if you financed your loan through a dealership, all these are great reasons for refinancing your vehicle loan.