How to Refinance a Car Loan

Do you want to lower your monthly car payments and save on interest? If that’s the case, you might ask, “What’s the best way to refinance your auto loan?” If you’re wondering how to refinance a car loan, you’ve come to the right place.

At Lee Motor Company, our finance team is here to explain how you refinance a car loan and what’s the best way to go about it. In this guide, we’ll explore what to know when refinancing your car around Evergreen. If you have additional questions, call us at (251) 277-8174 or reach out online!

How Do You Refinance a Car Loan?

So, what is the best way to refinance your auto loan? The main goal of refinancing is to lower the interest rate you’re charged every month. You’ll need to know how to refinance a car loan. The first thing is to review your documents and contact your lender to discuss your current interest rate and monthly payments. Once that’s completed, you should do the following: 

• Check Your Credit Score: If you’ve been making all your monthly payments since your vehicle, there is a good chance your credit score has improved, and you’ll benefit from refinancing.
• Start Applying: Apply to multiple automotive refinance companies to make sure you get the best rate. Be sure to submit all your applications within 14 days to minimize the potential impact on your credit score.
• Evaluate Offers: Take time to run the numbers to be sure any new offers coming back will provide the monthly payment you deserve. You can use our online payment calculator to compare offers. 
• Decide Loan Term: Determine whether you want a shorter-term or long-term loan to fit your situation. Short-term loans require larger monthly payments, but you’ll end up paying less interest in total. By contrast, longer-term loans will be smaller, yet you will pay more in interest in the end. 

When you ask yourself, “How do you refinance a car loan?” it’s important to review your current circumstances to be sure of what works best. 

What to Know When Refinancing Your Car

Above all, there are several things you need to consider when choosing the best way to refinance your auto loan:

• Fees: Be sure to review your original vehicle loan to make sure there aren’t any fees associated with paying it off early. If there is, refinancing is not a cost-effective idea.
• Underwater Finances: If you owe more on your vehicle loan than it’s worth, also known as a negative equity situation, it’s more difficult to get approved for refinancing.
• Older Models: Many Brewton lenders will not refinance an older vehicle that’s already experienced major depreciation. 

As you’re learning what to know when refinancing your car, be sure to reach out to our Monroeville finance experts. We can provide the best advice to fit your changing needs. 

Learn About Your Car Refinancing Options at Lee Motor Company

Beyond refinancing your car loan, Lee Motor Company’s finance team is here to answer all your questions. Whether it’s buying vs. leasing a car or bad credit car loans, we have the answers that have made us the Atmore area source for all things car financing. Reach out when you want to tackle your Monroeville car questions today!