Car Loan Refinancing - When To Refinance Your Car Loan

 Want to save money? Lower your monthly payment? Then refinance your old car loan. Trade in your high interest rate loan for a lower rate, especially if your credit score has improved. You can also lower your payments by extending your loan terms, helping your cash flow.

Trading In High Rates

When rates drop, refinancing makes sense for both mortgage and car loans. Factor in the length of the car loan though when deciding whether to refinance. If you only have a year left on loan payments, then it won't save you money to refinance since you have paid most of the interest up front.

You can also reduce your interest costs by refinancing for a shorter term. Reducing your loan by two years can easily shave over a thousands dollars off your interest charges, even with the same rate. Once again, you need to look at how long you have left on your original car loan to be sure you can save money.

Better Score, Better Rates

If you have improved your credit score since you first secured your car loan, you may find savings in better rates. So even if rates haven't dropped for the general market, you may still qualify for better rates.

Besides making regular, on-time payments, you can improve your score by reducing your debt ratio. Your score also improves when none of your accounts are maxed out.

Lower Payment, Longer Term

Reduced rates aren't the only reason to refinance. By rolling over to a longer term, you can reduce your monthly payment. Just remember that in the long run, you will be paying more for your car loan. However, when finances are tight, this option can keep you from defaulting on your loan or other bills.

Before jumping into a refinancing deal, be sure to investigate financing companies. Compare their APR, ask for free quotes, and read the fine print. Also check with your original lender to be sure there are no early payment fees. The best refinanced car loans are the ones where you save money. Taking the time to research financing offers will ensure that you find just such a deal.

About the author:

View our recommended Car Loan Refinance lenders.

 Carrie Reeder

More Articles 

Refinance Benefits - Refinancing Could Save You Money - Bwalya Mwaba
The most common reason most people refinance is to save money, but many people refinance for various other reasons. 1. Refinancing to Lower Your Monthly Payment for an Existing Loan. You can refinance your existing loan at a lower interest...

Refinance Or Not? That Is The Question - Hilda Schultze
What does it mean to refinance? Why would someone want to refinance? There are many cases when a person would refinance. When we use the term refinance, we are typically referring to a loan such as a car or house loan. It may also be a...

How to Finance a New Extention - John Mussi
Want to improve the look of your property? Want to add value to your property? Looking to finance a new extension to your home, a new kitchen, would you like to have double glazing, a new conservatory, patio, or a new heating system, or are you...

His And Her Finances - Simon Harris
It’s difficult to learn how to manage finances together when you’ve been managing your finances on you own, for better or worse, up until now. But when you become part of a couple, many things change, and your finances are no exception! Some couples...

Refinance Your Mortgage To Rebuild Credit - Carrie Reeder
Refinancing your mortgage is one way to rebuild your credit, particularly if you have recently declared bankruptcy. With a poor credit history, you can find refinancing through a sub prime lender. To rebuild your credit, make regular payments on...

Best Refinance Mortgage Rate - Improve Your Odds Of Getting A Low Rate - Carrie Reeder
Obtaining a mortgage refinancing has several benefits. However, the only way to realize these benefits is to qualify for a low rate mortgage. Even though refinancing a home is ideal for securing a fixed rate mortgage, without acquiring a lower...

Life insurance – wise investment in personal finance or excessive caution? - Rachel Lane
Life insurance is typically taken out to offer valuable financial protection for your family in the event of your death, upon which a payment is made to your financial beneficiaries, heirs or family members. The extent of this payment will depend on...

Finance Your Real Estate Investment Properties - Peter Dobler
Copyright 2005 Peter Dobler Unlike traditional residential real estate mortgages, real estate investment financing is way more creative and offers more options than you think. The golden rule in real estate investment is OPM (Other People’s...

100 Percent Refinance – No Down Payment Refi Loans - Carrie Reeder
Refinancing 100 percent of your loan allows you to cash out all of the value of your home. With no down payment required, you can use your money to pay off debt, invest in other property, or remodel your current home. When refinancing, make sure...

Finance And Lifestyle - Are They Interlinked? - Brad J Tamitnowson
Finance And Lifestyle - Are They Interlinked? When it comes to lifestyle, many debates spark up. Many people have their own idea of what lifestyle really is. But it is clear that finance and lifestyle need to co-exist in some form. In...

Refi Home Mortgage Loan – Refinance Your Home Online - Carrie Reeder
Refinance your home mortgage online to get the best rates. With increased competition, lending companies offer better rates online than in their offices. You can also get near instant loan quotes to make refi shopping easy. In a few minutes you can...

Auto Refinancing Guide - How to Refinance Your Car Loan - Claire Calkin
At some point in a person's life they come to a conclusion that they are paying more for something than they should. If you wish to break out of this cycle and refinance your car loan therefore saving you thousands of dollars in interest and high...