How to Refinance a Car Loan

Things change. That includes your finances. Maybe it’s been a couple of years since you took out a loan to buy your car, but your credit is much better now than it was then. So, you’re thinking it’s time to refinance for lower monthly payments, like so many of our Paramus customers have done.

But how do you refinance a car loan? Don’t worry, the friendly finance managers at Land Rover Paramus are here to help! So, let’s talk about the best way to refinance an auto loan and what to know when refinancing your car.

How Do You Refinance a Car Loan?

• It starts with your credit report. One of the most important things to know when refinancing your car is the state of your credit. There may be issues impacting your credit score that you don’t know about. Pulling your report will give you an opportunity to find these issues and fix them, which you should do before you apply for refinancing.
• Get pre-qualified before applying. The best way to refinance an auto loan is to get pre-qualified before you apply for a new loan. Pre-qualification is counted as a “soft” check of your credit, and it will not hurt your credit score. Pre-qualification is not a guarantee of a loan, but it will tell you whether it’s worth your time (and the hit to your credit) to apply for refinancing.
• Shop around for great rates. How do you refinance a car loan so that you get a great rate? Shop around! Our Ridgewood customers are often surprised to find out that different lenders often have different rates for the same loan. Fortunately, most dealerships work with multiple lenders, even lenders you may not easily have access to yourself. You can start the process with us by applying online.

What to Know When Refinancing Your Car

The best way to refinance an auto loan is to go in fully aware of possible fees, costs, and the state of your own credit. Here’s what to know when refinancing your car:

• If you’ve put over 100,000 miles on your car while driving through Saddle River and Jersey City, your vehicle is more than eight years old, or you still owe more on your old loan than the car is worth, you may not get better rates or even qualify for a refinance loan. Find out what counts as good mileage for a used car.
• There may be a prepayment penalty for paying off your old loan early.
• If your current credit score is not better than it was when you first took out your car loan, you probably won’t get better rates.
• There are fees on just about any loan. A refinancing loan is no exception. Check with your lender.
• Depending on the state you live in, you may have to pay to re-register your car or to transfer the title.

Let the Friendly Finance Managers at Land Rover Paramus Help

We’ll be happy to tell you anything you need to know about how to refinance your car. On the other hand, sometimes an easy way to get a loan with better rates is just to trade your current car in for a newer one. We make it easy for you to do just that. You can even find out what your trade in is worth before you come in. We’re just a short drive away from Fort Lee, so drop by or contact us today!