In this time of record low interest rates, you jumped on the bandwagon to refinance your mortgage, but did you ever consider refinancing your auto loan? Tap into this money saving secret and save big on your monthly car payment. Few take advantage of this opportunity. Thousands of dollars every year can be put toward better use if you take the time to look into auto refinance loans. They work similarly to a mortgage refinance and offer most of the same benefits. Even if you have a low interest rate, you may still be able to save money by refinancing your car.
Auto refinance loans are the same as mortgage refinancing in that you can get a better rate or change your term. Auto and home refinance is also the same because many of the same fees or penalties may apply. They are different in some ways too. You do not need to have your vehicle appraised in order to refinance it. The new loan is not based on the value of the car, as it is in a home refinance. The refinance is based on the amount you still have to pay on your loan.
Auto refinance loans are have different requirements as well. You must have a balance on your auto loan of at least $7,500 and usually less than $15,000 maximum. There are usually requirements on how old the car is. Most lenders want the car to be less than six or seven years old. Mileage requirements also apply. Lenders might also have stipulations on what kind of vehicles they will refinance. Furthermore, auto refinance is usually only done by a lender that does not have any affiliation with the current holder of the loan. They are looking for new business.
If your current interest rate is above 3% you might consider auto refinance loans. Applying for a refinance is usually easy, but take care that you get a lender that is trustworthy and offers you the best deal available. Make sure you do a good job filling out the paperwork to eliminate errors and keep the process smooth. Get the name on the application identical to what is on your current loan. You will also need to make sure the vehicle information, such as year, model, and 17 digit VIN are correct and match up with your current loan.