You may have heard about refinancing your mortgage for a better rate, but did you know that you could do the same for your car loan? Although the process and the terms are much less complex, not all borrowers will necessarily benefit from refinancing a car loan. Before refinancing your car loan, determine if you are a good candidate and if refinancing would get you the lower payments you’re after.
Improved credit score
Did you barely get approved for your car loan when you initially applied? If so, it’s likely that you were approved with a high interest rate and you’ll still paying that same rate. If your credit score has improved since obtaining your car loan, you may now be eligible for a much lower rate. Be sure to do a credit check first to confirm what your current score is. If it’s dropped or is the same, you might be better off avoiding the additional credit inquiry and just keeping the car loan you already have.
Very high interest
Is the average nationwide interest rate for loans currently much lower than what you are paying? Even if your credit score hasn’t changed, a significant dip in nationwide rate averages might make you a prime candidate for refinancing.
If you originally obtained the longest car loan term possible so that you can afford the monthly payments, you might want to think about refinancing if your financial situation has improved. Although you may not see much savings in your monthly payments, shortening the overall length of your loan will save you a significant amount of money in the end.
Are you in debt and you need cash now to catch up on bills and loan payments? If you’re the recipient of an annuity or structured settlement payment stream, we can help. At Peachtree Financial Solutions, we can buy some or all of your future payments and offer you cash now. Contact us today for more information and for your free, no-strings-attached quote.
Nothing above is meant to provide financial or tax advice. You should meet with appropriate professionals for such services.