Refinancing your auto loan is a great way to save money. It can possibly help you pay off your loan faster and with lower interest. If you bought a vehicle a few years ago and you’ve gotten a raise or promotion or have simply gotten better at budgeting, refinancing can be a great way to get that car paid off so you can start focusing on your other financial goals.
Check out our tips to succeed before you get started.
Run a Credit Check
Like almost any major financial decision or step you take, you’ll need to start by checking your credit history to see your score. This will likely determine whether or not it makes sense for you to refinance your auto loan.
If you have a credit score below 600, it might not be effective to refinance your loan. If you don’t know your credit score some auto dealers might attempt to use this as a way to charge you higher rates or get you locked into more difficult deals, so come prepared.
Gather Current Loan Information
Obviously, before you try to refinance your loan, you should know and understand the details of that loan. You’ll need to gather specific information such as how much your remaining balance is, along with your current interest rate. Other information, such as how long you have left on your current loan could be helpful also.
Make a Plan
Don’t refinance just because you want to save money; make sure it’s the right option for you. Obviously, you do want to save money, but before meeting with a lender, it’s good to have a plan. Refinancing sounds like a great idea, as anyone would be happy to pay less interest and get their loan paid off faster.
Most of the time, people refinance because their financial situation has changed; a new promotion, a marriage that joins your accounts with your partner’s, better budgeting skills. Whatever the case, it’s good to plan out how you will pay for these new payments.
Don’t Rule Anything Out
Fortunately for you, there isn’t just one option for refinancing your auto loan. This is important to remember if you’re considering this process. If you meet with someone at a bank or credit union and it doesn’t fit your needs or budget, check out other options.
Typically, with loan refinancing, if you’re not happy with the options available at a large, national bank, local credit unions and lenders can be helpful since their primary goal is to serve their clients and build relationships rather than make the biggest profit. You can also check sites like Credit Karma, to research basic rates from a variety of lenders.
Pick the Right Lender
As we mentioned, there are a lot of options for you when you decide to refinance your auto loan. In discussing this with a banker, it can seem like you need to make a decision and be quick about it, but don’t fall into this trap. Like any large financial decision, an auto loan requires patience and care. Choose someone that is willing to help you and work with you to accomplish your goals.
If you have more questions about refinancing your auto loan, give WEOKIE a call today at (405) 235-3030 or 1 (800) 678-5363- we’re happy to help. Or if you haven’t even applied for your initial loan but you’re thinking of getting a new car, download our free guide to learn what you need to apply for a car loan!
*See a WEOKIE rep for details. Federally Insured by NCUA