If you’re not entirely happy with your current car loan situation, whether the interest rate is too high, or the loan term is too long, it may be time to refinance. Today we’re breaking down what’s involved with refinancing, and how you can refinance a car loan online!
Determine if refinancing is the right step for you
The first step in refinancing a car loan is determining if it’s actually a good idea. If your interest rate is already low enough, or the loan repayment time is reasonable, then going through the hassle of refinancing may not be worth it. However, if that’s not the case for you, then read on!
Additionally, you’ll want to make sure that you’re up to date on your existing loan repayments, to show your new lender that you’re trustworthy and give you the best chance of getting your loan approved.
Shop around
The next step in refinancing a car loan is to shop around for the best interest rates. Check out reputable online lenders, credit unions, and even any finance companies you’ve dealt with in the past. Start comparing terms of different loans – repayment periods, interest rates, etc. It may help to figure out what you want your new monthly payments on the vehicle to be, then start comparing interest rates until you reach that point.
Apply online for a car loan refinance
Once you’ve found the best loan, it’s time to apply! We recommend applying through an online platform where you can compare rates from multiple lenders at once. There are no fees or obligations attached to getting your rate quotes, so it’s a great way to shop around and compare rates. You can even attempt to refinance the car loan you currently have (subject to lender approval) and see how much it would save you, without impacting your credit score at all!
Stay organised throughout the process
Even though refinancing a car loan is actually very simple, there are still a few things you can do to stay organised and make the process as smooth as possible. Make sure you know your current loan amount, term, interest rate (if applicable), and monthly payment. It’s also a good idea to have your current insurance information on hand so that the lender can ask for it right away.
Once you’ve completed all the steps, you should receive your loan agreement within a few days. Read it carefully, and if there’s anything you don’t understand, make sure to ask the lender before signing. Once you sign and return the contract, your new car loan will be processed in a few business days!
By following these simple steps on how to refinance a car loan, you can save a significant amount of money by getting a more affordable interest rate. And the best part is that it’s not going to affect your credit score at all! Some lenders even offer similar rates for those with bad or no credit as well, so this may be an option if you have a low score.
