How to Refinance a Car Loan
Are you looking to lower your lower monthly car payments while saving money on interest? If so, refinancing your car loan is your best option. INFINITI of Clarendon Hills is covering the ins and outs of how to refinance a car loan so you have all of the needed information.
How Do You Refinance a Car Loan?
Elmhurst-area drivers opt for refinancing in order to lower the interest rate being charged each month. To take advantage, you will need to know what you are currently paying in interest. Go over your documents or speak with your lender to confirm your current interest rate and monthly payments. Once you have all of that ready, you can perform the steps below:
- Check Your Credit Score: If you have been paying all your bills on time since your vehicle was purchased, there is a good chance your credit score has improved and you could benefit from refinancing.
- Start Applying: Apply to several automotive refinance companies to ensure you get the best rate. Be sure you’re submitting all applications within a 14-day period to minimize the negative impact on your credit score.
- Evaluate Offers: Take time to run the numbers to make sure any new offers coming back will get you the monthly payment you are looking for. Use our online monthly payment calculator to help compare offers.
- Decide Loan Term: Decide if a longer or shorter-term loan fits best fits your situation. A short term loan requires larger monthly payments, but you will pay less interest in total. With a longer-term loan, your monthly payments will be smaller, but you will pay more in interest in the end.
The best way to refinance an auto loan will vary based on your circumstances, so make sure that any offer or term fits your financial situation the best.
What to Know When Refinancing Your Car
There are other things to think about when deciding whether or not to refinance your car:
- Fees: You will want to check your original car loan to make sure there aren’t any fees associated with paying it off early. If there are, refinancing may not be cost-effective.
- Underwater Finances: If you owe much more than your vehicle’s currently worth, it can be harder to get approved for refinancing.
- Older Vehicles: Many lenders won’t refinance an older car that has already experienced major depreciation.
If you are in any of these situations, feel free to contact the INFINITI of Clarendon Hills finance center. Our financial experts will guide you in the right direction.
Learn About Your Financing Options at INFINITI of Clarendon Hills
After learning how to finance a car loan, Westmont drivers can make the short drive to INFINITI of Clarendon Hills to explore their options even further. Our team is here waiting to share what’s needed for you to refinancing your auto loan. Give us a call today for additional information or if you have any questions like what is gap insurance and how much is the coverage.