How to Refinance a Car Loan

February 6th, 2019 by

Photo of hands holding pencil and pressing calculator buttons over documents

Are you looking to lower your monthly car payments and save on interest? Visit Tom Gill Chevrolet and see if refinancing your car loan is the best option for you. We will go over the ins and outs of refinancing, so you can an informed decision. Stop by our Cincinnati-area finance department for more information.

How Do You Refinance a Car Loan?

When refinancing, the goal is to lower your interest rate. In order to do this, you need to know what you’re paying each month. Refer to your documents or speak with your lender to confirm your current interest rate and monthly payments. Once you have the information ready, follow these steps:

  • Check Your Credit Score: Have you paid all your bills on time since getting the car loan? This has likely improved your credit score and increased your chances of refinancing.
  • Start Applying: Apply to multiple automotive refinance companies to secure the best rate. Submit your applications within a 14 day period to reduce your chances of it negatively impacting your credit score.
  • Evaluate Offers: Run the numbers and make sure that any new offers coming back get you the monthly payment you want. Use our online monthly payment calculator to help you compare offers.
  • Decide Loan Term: Decide if a longer or shorter term loan is the best fit. A shorter term loan does require larger monthly payments, but you will pay less interest in total. With a longer-term loan, your monthly payments are smaller, but you will pay more in interest in the end.

The best way to refinance an auto loan will depend on your circumstances. Be certain that any offer or term you opt for is best for you.

What to Know When Refinancing Your Car

There are things to remember when deciding whether or not to refinance your car:

  • Fees: Check your original car loan to make sure there are no fees associated with paying it off early. If there are, refinancing may not be the right option.
  • Underwater Finances: If you owe more than your vehicle’s currently worth, it can be difficult to get a refinance loan approved.
  • Older Vehicles: Many lenders won’t refinance an older car that has already experienced major depreciation.

If one of these situations is what you’re going through, contact the finance center at Tom Gill Chevrolet. Our experts will give you advice and guide you through your various options to help find one better suited for your circumstances.

Learn About Your Financing Options at Tom Gill Chevrolet

Our finance experts are here to assist with your refinancing needs. We will go over your available options, everything you need to know about refinancing the process, as well as answer any questions you have like what happens if you can’t make a car payment. Contact us online to make an appointment!