Overlooked Benefits Of Refinancing Car Loans

Overlooked Benefits Of Refinancing Car Loans
Hearing about refinancing mortgages is​ common,​ but you​ may not have thought about refinancing your car loan when interest rates drop .​
Refinancing an​ auto loan can be a​ good idea for several reasons,​ and it​ is​ easier than refinancing a​ mortgage.
Refinancing could save thousands of​ dollars over the​ life of​ the​ loan,​ even if​ you​ received a​ decent rate .​
Anyone who didn’t get a​ car loan below 3% APR should consider refinancing .​
More than likely,​ however,​ your APR was much higher than that .​
If you​ had a​ few dings on​ your credit report when you​ bought a​ car,​ the​ lender may have quoted you​ 20% to​ 25% APR .​
Despite what you​ might think,​ you​ aren’t stuck at​ this rate .​
Once you​ have held the​ loan for about 6 months and paid on​ time,​ lenders are more willing to​ take a​ chance on​ you​ .​
You can also change a​ few things to​ raise your credit score in​ that period .​
Let’s say you​ received a​ loan for $16,​500 for 60 months at​ 21% APR .​
If you​ refinance at​ 7% APR,​ your monthly payments will drop from about $446 to​ $330 .​
Those savings over the​ life of​ the​ loan totals about $6,​945 .​
As you​ can see,​ refinancing is​ key.
Refinancing will not only save you​ money,​ but it​ can also be the​ only way to​ help get you​ out of​ debt .​
If you​ are paying 25% APR,​ there is​ no way you​ will ever be able to​ get out of​ debt while making these payments .​
Since you​ pay most of​ the​ interest early in​ the​ life of​ the​ loan,​ the​ earlier you​ refinance the​ better,​ and the​ more money you​ will save
One of​ the​ differences between car loans and mortgages is​ that lenders will not refinance car loans that they originally loaned .​
You will have to​ find a​ different lender to​ refinance your loan .​
You can find lenders at​ banks,​ credit unions,​ or​ even online that will refinance an​ auto loan .​
Remember to​ shop around for rates for refinancing to​ get the​ best deal .​
It usually only takes 5 to​ 10 minutes to​ fill out an​ application,​ and there is​ generally not any risk involved in​ applying for a​ refinance.
Overlooked Benefits Of Refinancing Car Loans Overlooked Benefits Of Refinancing Car Loans Reviewed by Henda Yesti on August 22, 2018 Rating: 5

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