Tag Archives: refinance

Qualifying for Refinancing An Auto Loan

You may have heard from different people that refinancing your car loan is a terrific option to keep the automobile you want while still getting a better price on your loan. True, but qualifying for refinancing an auto loan is not as simple as this seems. There are many requirements that you, your vehicle, and your loan must meet.

The majority of borrowers prefer to refinance their auto loans to pay lower monthly interest. You can save hundreds or even thousands of dollars in total interest over the life of an auto loan if you refinance it to a cheaper interest rate.

Requirements for Refinancing an Auto Loan

1. Sort your documents

You must supply information about your current car loan and the vehicle to apply for a car loan refinance.

2. Must have a good credit score

Refinancing is usually for those with an excellent credit score. If you have a terrible credit score, you must improve it before considering qualifying for refinancing an auto loan.

If you intend to refinance, you must demonstrate that your financial status has improved. This translates to a higher credit score. A car loan is an excellent way to build your credit, and as long as you have been paying all of your payments on time and have not missed any other payments, you should not have any trouble demonstrating that your credit score is not in better condition.

3. Look for a Refi Lender.

You should apply for a car loan refinance with various banks and lenders, including your existing bank, online lenders, and other local, national, and credit union banks and credit unions. You can often take advantage of a bank’s offer by combining it with another bank’s offer to receive a better rate.

Is Your Car Eligible for Refinancing?

Not every car qualifies for refinancing. Most refinance lenders stipulate that your car is within a specific age and mileage range. These vary by lender, but most only refinance automobiles less than ten years old or have less than 100,000 miles on them. In addition, there must be equity in your vehicle.

Requirements for Existing Auto Loans before Refinancing

When you refinance your auto loan, you replace it with a new one with changing rates and terms. You can try to refinance with your present lender, but many consumers prefer to go with someone else.

Moreover, you must be current on your payments, and your old vehicle loan amount must fit within the new lender’s loan amounts. You will not be allowed to refinance if you have defaulted on your loan until you have paid off your past-due loan sum.

Why Should You Refinance Your Car Loan?

The primary motivation for borrowers to refinance is to reduce their monthly payments. You can achieve a lower automobile payment in two ways: by qualifying for a lower interest rate or extending the loan period. Both of these reduce your monthly payment, but only a reduced APR makes your car loan cheaper in the end.

Final Verdict

If you are thinking about qualifying for refinancing your auto loan, make sure you fit its requirements.

Refinance contracts are not available from all lenders, and it is not always simple to spot them in a crowd. We at Carloanrefinancing.com specialize in connecting customers with dealerships that can assist them, and we are excited to now provide even more refinancing options through our trusted partners.

Allow us to assist you if you have been having trouble getting a bargain. Fill out our quick, no-obligation vehicle loan request form right now to get started. We will begin to pair you with a dealer in your area as soon as you have completed the form.

Will Refinancing My Vehicle Hurt My Credit?

It is crystal clear that every time we take out a new line of credit, we will face a minor drop in our credit score. Since refinancing means drawing a new line, our credit is bound to go downhill even if we didn’t get a new vehicle.

So will refinancing my vehicle hurt my credit? Yes, it will. Here are some top ways how refinancing may affect your overall credit score.

How Will Refinancing My Vehicle Hurt My Credit?

Refinancing is the option that many opt to lower their monthly payment amount. You can do so by taking out a new car loan for the same vehicle. Refinancing proves to be efficient if you find a new loan with relatively lower interest rates.

By clearing the payment for the original loan, you close its account and open a new account for the refinanced loan. The refinancing process also requires a new credit, as the new lenders will ask for new credit reports. The refinancing procedure includes three steps:

Sending approval for new credit
Closing the previous loan account
Opening a new account

This procedure has impacted two different features of your overall FICO score. Be cautious! It can result in a meager drop in your credit score.

New credit 10%

The new credit portion is responsible for evaluating how many times you have applied for a new line of credit. When refinancing, the lender investigates your credit report, eventually resulting in a slight drop in the score. Your score drops from between five and twenty points, depending on your current credit score and history. The refinancing procedure also requests a hard inquiry on your credit, which can affect your credit score up to 12 months or even two years.

Length of credit history 10%

This category of the FICO credit score evaluates the length of your credit history and the ages of all of your previous credit lines. The older they are, the more beneficial it is for your credit score. When you close one account and start a new one to refinance, you reduce the age for all of your currently active credit lines. It will keep hurting your credit score until the account has matured enough.

So, this is how much refinancing your vehicle will hurt your credit. It is normal to see a sudden drop in your credit score right after refinancing. But many borrowers have reported that the credit score tends to return once you make consistent monthly payments for the refinanced car loan. Even if your credit score hurts from the refinancing process, it is not a big hassle since you will save a hefty sum of money through the refinanced loan.

Why Do People Choose to Refinance Their Vehicles?

Most borrowers intend to get a refinanced loan to save money from their monthly car payment amount. They do so by getting a loan with lower interest rates or switching to a longer-term refinanced loan. However, finding a loan with a low-interest rate is the authentic and best way to save a hefty amount of money. Because when extending the loan term, you will have to pay interest at the original rate, which can be even more costly than the original plan.

Borrowers who had bad credit when taking out the original car loan tend to look for refinancing because they have gradually improved their score through consistent monthly payments. Qualifying for a loan with a low-interest rate is the only key to saving up a lot of money from interest charges.

If you are dissatisfied with your original car loan, consider refinancing. And if your credit score has progressed since you last took out the loan, you may qualify for a refinanced loan.

How to Finance With Bad Credit?

Are you looking for lending resources while having bad credit? Then your search ends here. CarLoanRefinancing is the best and reliable platform to provide you with trustworthy lending resources. All credit goes to our widespread network of expert finance dealerships that help bad credit borrowers establish relations with suitable dealers that can help them with their bad credit.

To find out if you have a finance dealership around you, fill out our free auto loan request form.

How To Get A Car Refinanced in Someone Else’s Name

It is not possible for anyone to completely take over your auto loan. They must be the ones to finance it first. But, if you are trying to avoid going through the tiring and messy reselling process, they may get the option to refinance your auto loan. Here is a detailed blog on how to get a car refinanced in someone else’s name.

What Does Refinancing a Vehicle Means?

Refinancing means taking out a new auto loan for the same vehicle. It is a way to reduce the monthly car payment rates by getting a loan with favorable terms. You pay off your old loan with the new auto loan. Most borrowers choose to refinance their original loans to save money by getting low-interest-rate plans.

However, if you don’t want the vehicle anymore, and someone else is willing to refinance it, you must sell it to them. It means that he will be refinancing it by taking out a new loan under his name.

When taking out an auto loan, the lender mentions your name on the loan so that you are obliged to pay off the monthly balance. There is no need to contact your lender, but you should directly talk with someone who will willingly take the duty of the loan. Your original auto loan must be compensated either by you, your lender, or a new party who takes over your car for you to stay on the safe side. It makes it possible and secure to get a car refinanced in someone else’s name.

How Can I Refinance a Private-Party Car?

If you have decided on transferring your car to a new party, they should contact a lender for refinancing. Mostly, third-party lenders who have contracts with dealerships do not offer services like refinancing and financing for the private-party transaction. If the person who wants to take your car qualifies for the financing, the loan will help pay off your old lender. And the car title gets transferred in their name. And you get free from the loan responsibility.

Your top priority is to find a beneficial offer that is large enough to cover the lien expenses of the title. It is simple to figure out how much loan you have left to pay. You can easily do so by checking your loan through an online portal (if you have the option), or you can request a 10-day pay-off amount. It is your loan balance along with ten days of interest charges.

Once you have gotten your loan balance, you can hand it over to the person who wants your car. It will help them know what amount of loan they should apply for. Your buyer also needs a great deal of your vehicle’s information to proceed with the buying process. Such information includes:

Manufactures
Model or car year
Mileage
Overview of the car’s condition
Vehicle identification number (VIN)

If your buyer succeeds in securing the loan, their new lender may send a payment check to your lender along with an application to request the removal of lien and transfer of car title to the new owner.

What if My Buyer Fails to Get Approval for Financing?

Getting approval for an auto loan can be a difficult task unless you have a decent credit score. Most auto loan lenders prefer the borrower with over 600 credit scores. So, if your buyer doesn’t have this required score, then try using cash!

If you wish to sell off your car, but you can’t get the needed loan, then trade in your vehicle for some replacement. It is not the perfect solution, but it has proved workable in many cases.

Since the demand for used cars is very high, try selling them to a car dealer. It is because of a lack of newly manufactured automobiles due to the factory shutdowns from last year. That is why dealers are paying high prices for pre-owned cars.

Carloanrefinacing Offers Auto Loans to Borrowers With Bad Credit

CarLoanRefinancing has years of professional experience in helping borrowers with bad credit to find suitable and reliable lenders. We have a network of signed dealerships and associated lenders throughout the nation who will assist borrowers in facing and managing problems with bad credit.

Feel free to fill out our free auto loan form and get signed with the best dealers right away!

If I Refinance My Car Loan Will I Lose My Warranty?

Are you wondering, “ If I refinance my car loan Will I lose my warranty”? Well, the answer to this question is not that simple. In most cases, when you have a manufacturer or an extended warranty, you don’t lose it. However, there are some solid exceptions. Let’s take a close look to understand the relation between your car warranty and refinancing.

A Deep-Down Analysis of Auto Warranties

Commonly-used warranties come with several default services that you can access through them.

When buying a new or a certified second-hand vehicle, you get a car warranty. It includes services like vehicle protection and repair coverage. Most car warranties have a starting point of three years or 35,000 miles. However, some may be short or long. Keep in mind that certified pre-owned cars don’t have as exclusive warranties as the new ones.

When financing a used vehicle, you can buy an extended warranty. It is more similar to an insurance plan as it covers the repairing costs etc. you can purchase such service contracts anytime you feel the need. However, at the time of purchase, many car dealers also offer such insurance plans.

How Does Refinancing Car Loan With a Warranty Look?

Refinancing means closing your current loan and starting a new one on the same vehicle. But the difference is that a refinanced auto loan comes with lowered interest rates. You can do so by contacting your lender or a refinancing company. Through refinancing, you have to pay discounted monthly car payments, which is a total win.

Refinancing also covers any extended warranty that you have activated through your loan. It is because refinancing covers your original auto loan. Your car warranty is not affected as long as your refinanced loan is providing coverage.

What Are the Refinancing Requirements?

Lenders offering auto loan refinancing have requirements that include having a good credit score and vehicle condition. Requirements vary from lender to lender, but here are some standard must-haves:

You must have an active auto loan
The vehicle should be worth almost equal to or more than the loan amount
The car must be in good condition, like acceptable age and mileage.
The car’s title must be clean
You and your loan must follow the term and conditions given by the lender

If you have an excellent credit score, you’ll get a good refinancing offer. However, if you have taken out your previous loan with bad credit and now you’ve improved the credit, then you’re also eligible for loan refinancing.

Remember that there is no gain in delaying your loan refinancing. If you waste time considering, you’ll end up paying a big sum of interest money, mostly when refinancing to a longer-term plan.

You should build up a solid payment history before choosing to refinance the auto loan. The reason is that you’ll be signing a long-term refinanced loan with a lower interest rate. Keep in mind that in case of bad credit refinancing, you’ll have to wait for one year to become re-eligible for signing a new contract.

Now let’s dig into, do I lose my car warranty if I refinance or not?

If I Refinance My Car Loan Will I Lose My Warranty?

The straightforward answer is no. Your service contract and car warranty will most likely survive the refinancing. However, look out for conditions on your warranty card before going for refinancing because some warranties have warnings such as warranty cancellation on refinancing, etc. It’s best to do a thorough rundown on the documents before making a final decision.

Here is a list of items that can nullify your car warranty instead of auto loan refinancing.

Title changes
Misuse of the vehicle
Odometer tampering
Improper vehicle care
Aftermarket alteration

So, if I refinance my car loan, will I lose my warranty? No, you don’t. Car warranty is not sensitive to refinancing, but it gets canceled when the vehicle is used improperly or illegally and when unlawful alterations are made.

When Can I Refinance My Car Loan?

There are instances where you can’t find the right deal for yourself. In times like these, there’s no need to hurry. Wait patiently for your ideal kind of deal to show up. You have plenty of time, so don’t rush things. When can I refinance my car loan? You can’t find a new lender as soon as you drive off the parking lot with your new car, right?

So, take everything at a steady pace. And let’s look into how early and late you can refinance your car.

A Guide to Refinancing Timeline

Refinancing is a means to lower the amount of money you’ll be paying for the monthly payments. It’s better and best to wait for a year before applying for auto refinancing, especially when you have taken out the loan on a bad credit score. This one-year gap allows your credit score to jump back to normal, giving you chances to qualify for refinancing. On the other hand, if you can’t find your ideal interest rate while your credit score is doing well, you will qualify for refinancing in six months only.

It’s clear that your refinancing solely does not depend on your credit score. But also on the ability of the lender you’re working with. If your path is clear, you can even get refinancing in two to three days only. But, you should at least wait for 60 to 90 days because it prevents problems with paperwork and title transfer.

Refinance and Save up Money Now

When you choose to refinance your car loan, you pick to close out your original auto loan and start a new one, probably with a new lender. The main objective of loan refinancing is to help you save money from the monthly payments by lowering the amounts. You can do so by refinancing your loan to a lower interest rate loan or a long-term one.

The combo of lower interest rates and long-term loan plans will help you put aside a hefty sum of money. Since your ultimate goal is to save money, try every possible means to qualify for a lower interest rate. Or else you will end up paying even more money than the original plan without realizing it.

Qualifications You Need to Refinance Your Car Loan

Qualifying for a low-interest rate refinanced loan can be difficult. To increase your chances of qualifying, you must strive to bring your credit score to the green zone, even if it takes you to work an extra mile.

There is no doubt that having a decent credit score is a fundamental requirement to get qualified. If you have succeeded in improving your credit score since taking out the auto loan, you are most likely to get the refinanced loan.

Other than credit score, you must fulfill requirements like:

Having a loan that fits the lender’s criterion
Having a good car mileage. Less than 100,000 miles would be perfect.
Paying your current loan

Refinance vs Trade-in. What Should I Choose?

The bitter truth is that refinancing doesn’t work out all the time. Sometimes, your car may not be eligible for qualifying, which can make the entire process fail. If you are looking for something to replace refinancing, consider trading in your vehicle. It is an affordable solution that has proved to be workable for many of us.

When choosing the trade-in option, you have the freedom to pick any equity in your car as a down payment. However, if you have negative equity, you have the option to roll it into your next auto loan plan. There are numerous benefits of following this easy and uncomplicated route. You will most probably get a good deal because used vehicles are so much in public demand. That’s why to act wise and fast while choosing the trade-in path.

If you think you are mentally and financially ready to start a new loan, we will gladly offer a helping hand. At CarLoanRefinancing, with our years of professional experience, we’ll connect you with reliable borrowers who will help fill your needs. Take out some time and visit our convenient and time-saving web portal to fill out the form.

Auto Loan Refinance: 5 Questions to Ask

Are you ever told by your friends and relatives that you should get a better auto loan offer? Auto loan Refinance doesn’t prove to be fruitful in every case. But for some individuals, it’s a jackpot.

The ticket to success in refinancing is to know the right timing and plan. People have solid reasons to seek auto loan refinancing. If your answer to any of these questions is yes, consider refinancing a car because there are chances that you could really hit the jackpot.

1. Is paying a lowered monthly payment your priority?

As reported by Experian, the average monthly payment for a used car in 2021 is around $430. That’s a hefty sum of money, especially when you barely have just enough money.

The primary benefit that refinancing offers is that you can pay off the loan in a longer time than the original plan. Each of your monthly payments becomes less through this option.

The drawback is that you’ll be paying monthly payments for a longer amount of time. It results in paying extra interest over the life of your auto loan.

2. Do you wish to lessen the life of your auto loan?

Doesn’t it sound great to save up money in your bank than send it to a lender? Absolutely, yes! The other highlighted reason why people prefer refinancing a loan is to reduce the interest rate.

It occurs by two means. You can refinance the auto loan for a shorter term, or you can find a refinanced loan with a lower interest rate. These two options will definitely save you a ton of money!

3. Did you purchase a bad deal from the car dealer?

Car shopping is not as easy as it seems. You are continuously bare to scams and high-pressure sales tactics, which leads you to sign a not-so-ideal loan plan. Car dealers tend to undervalue the car, which leads to a higher loan amount on it. Besides, dealers also mark up the interest rate and profit off the extra payment that you pay.

However, there is a way to escape from this plotting. You can apply for a better car refinance to get a better loan. If you choose to refinance through CarLoanRefinancing, we never plan on charging extra. So it is a hundred percent safe and secure option to get a loan refinancing!

4. Did your credit and financial conditions change?

If you are a quick learner, then like most credit holders, your credit score would have taken the road towards progress since you’ve learned how to manage credit score and history better. Your financial condition might have also improved if you’ve made growth in your career and earnings.

These are the perfect times when you should consider refinancing your auto loan. Even if you are still working to make your credit score better, you should look for loan refinance offers through CarLoanRefinancing. It is because we pay attention to other factors as well rather than credit score only. Keep an eye on the recent options, and apply right away when you find a suitable loan refinance plan.

5. Do you wish to take out a co-borrower from your loan?

Cars are an expensive asset, and most of the time, no one is financially well-off to own a car individually. For this reason, people tend to share a car (and loan as well) with another person or co-borrower. There’s another possibility that your credit score was not good enough to take out a loan, and you needed a cosigner on the auto loan.

If your financial circumstances have improved and you wish to remove the cosigner or co-borrower from the loan, you should refinance it. Keep in mind that if you plan to refinance an auto loan through CarLoanRefinancing, you’ll need to have permission from the cosigner/co-borrower.

How Does Refinancing a Car Loan Through CarLoanRefinancing Work?

Paying off auto loans seems like a heavy burden on the shoulder and the budget as well. The only hope that keeps us going is that we are not stuck with it for a lifetime. We refinance our auto loans and get to pay lower payments or interest rates or even both. Refinancing a car loan helps you save up a hefty sum of money in the long journey. To give a short example, loan borrowers save up to $912 per year by refinancing.

If you have never considered refinancing, you should. It is an uncomplicated process if done through CarLoanRefinancing. We hold years of experience in this field.

What Are the Steps to Refinance My Car Loan Through CarLoanRefinancing?

It doesn’t require any rocket knowledge in refinancing a car loan. Through CarLoanRefinancing, we have simplified refinancing even more by using the latest technology. We have award-winning customer support that helps you walk through the entire process step-by-step.

Step 1: Go through your rate.

Visit our online form and check out what rate we are offering. It takes less than five minutes and only basic information, such as:

Name
Birthdate
Home address
Education status
Income proof

We perform a soft inquiry on your credit, meaning this step doesn’t affect your credit score. We get most of the car information by car and the car loan information you’ve provided. If we can’t, we’ll require other details like car model, trim, and mileage.

Step 2: Review loan offers

If you pass the previous step, we’ll give you loan offers to review. This step helps you choose the right monthly payment amount, the length of the plan, and the interest rate.

The loan amount we’ll show will be higher than your original loan balance. It’s normal because your lender will refund the leftover money once the previous balance is $0.

Step 3: Submit your application form.

After selecting any plan you find suitable, you’ll need to provide additional information like your social security number and your insurance details. After this, we’ll instantly verify your application and redirect you to step number five.

Step 4: Submit any additional documents.

Sometimes, we also require additional documents like a driver’s license or a copy of your pay stub.

If we need any extra information, we’ll reach out to you right away. Your cooperation is a must through this time so keep checking your email to avoid any inconveniences in the application verification.

Step 5: Check and sign the final documents.

Once we’ve collected and verified the required documents, we’ll call you to check the loan terms & conditions and sign the permission form for a hard credit check. Most of the time, a hard credit check barely affects your credit score. According to FICO, the consequences of the hard inquiry would be marked off completely within two years.

After receiving your signature on the promissory note, we’ll go through the vehicle and insurance details once again. We’ll also check whether you’ve signed the documents to start working with CarLoanRefinancing or not.

Usually, we do these steps electronically, but due to varying laws and policies in different states, you also need to sign a physical copy. For this purpose, we’ll mail you the forms along with a prepaid envelope. Some states also demand a notarized form. For this purpose, we’ll provide detailed instructions that you have to follow.

Step 6: CarLoanRefinancing pays your old loan

After going through the official paperwork, we’ll deliver a check to your previous lender to clear your old auto loan. If we’ve overpaid the lender, he’ll have to refund it back to you.

Make sure to pay off your loan entirely until you see $0.

After we’ve cleared the old balance, the title transfer process will start. It may take up to 60 days to complete it. We may transfer the loan to your state’s Department of Motor Vehicles or under your name.

Step 7: Shift to paying your CarLoanRefinancing powered loan

After CarLoanRefinancing clears your previous loan balance, you’ll start to pay for your new loan monthly. You should pay the first payment within 30 days of initiating the new loan. We’ll plan the process in an organized way so that you don’t have to make payments for two loans in a month.

We’ll make things easy for you by presenting several easy payment methods.

Switching to automatic payment will lift off the burden of making manual payments monthly. We also offer a bi-monthly payment option. You can make such payments via autopay or manually and check your paychecks regularly.

All in all, CarLoanRefinancing has come up with an easy and convenient method for refinancing a car loan.

Your Ultimate Guide for Auto Loan Refinance

Americans incur a hefty sum of $1.2 trillion on auto loans alone. It takes about ten percent of the overall consumer debt. With increasing unemployment due to COVID-19, Americans are finding effective ways to save money where possible, including auto loan refinance to reduce their monthly payment costs.

Auto refinancing may sound like THE best idea, but most people are unaware of what it entails and its long-term effects.

All Must-Knows About Auto Refinancing

If you are looking for capable ways to save money from your monthly payments, consider refinancing a high-interest loan into a lower-rate loan. It will help you save money over time.

If you are paying pricey payments each month, refinancing the auto loan to a long-term plan would result in lower monthly payments. However, conditional on the number of months you add to your plan, you’ll automatically have to pay more money over the lifetime of the auto loan. Therefore, do calculations to estimate how much additional money you’ll be paying over the added months.

Beware! Auto loans usually come with an extra fee, and it also ruins your credit score badly. To conclude this, auto loans are not guaranteed “money savers.”

At CarLoanRefinancing, we will provide in-depth answers to your question. So you make the most well-informed decision possible. Here are some FAQs about auto refinancing and related outcomes. Go through them carefully and decide whether you want auto refinancing or not.

What Is Auto Loan Refinancing?

Auto loan refinancing is the process of replacing your already existing loan with a new loan at a different interest rate. Such loans are taken for cars and paid through monthly payments, which may take over several years.

When Should You Refinance Your Car?

One of the essential factors when considering refinancing is the available interest rate. Interest rates tend to fluctuate regularly, so the interest rates may have dropped since you’ve taken out your original auto loan. Even a 2 or 3 percent drop would save you a large sum of money over the entire loan period.

If your financial situation has improved over time, your lender should look at your debt-to-income ratio. If it’s in good condition, your lender will most likely reduce the interest rate. It will gradually save you a hefty sum of money.

What Items/Documents May Be Needed for a Car Refinance?

To refinance your loan, the lender needs the following information/documents:

Your ID
Proof of income
Financial history
Proof of residence
Your vehicle’s information

How Does Refinancing Affect Your Credit Score?

When you apply for a loan, lenders tend to check your credit. They perform a hard inquiry on your credit to check your credit score and history. It’s why refinancing lowers down your credit score temporarily.

If you hold certification for refinancing, you could save money from the monthly payments. If you have other debt to pay, you can utilize the money you’ve just saved.

What Are the Tips I Should Consider When Refinancing?

If you still plan to get an auto loan to refinance, here are some top tips to help you.

Your credit score and profile, car mileage, model, and trim will lead the lender to determine the new interest rate. So it’s best to keep these factors in good shape.

Additionally, the lenders will consider your loan-to-value ratio and the number of payments left to be paid for the original loan to come up with benefits for both parties. When considering refinancing a loan, it’s important to learn how much the car has depreciated, your loan-to-value ratio, and your current loans.

Once you get the desired interest rate, try your best to understand any additional fees or prepayment penalties so you recognize every single penny you will be paying.

If you have understood all of the above factors, take the next step and refinance your car with CarLoanRefinancing right away!

Top 5 Misconceptions About Refinancing a Car Loan

Do you wish to find a way to lower your monthly car payments? You know what, even saving $50 or $100 a month adds up to make a hefty sum of money in a year. According to a study done on auto loan refinancing in 2021, a car owner saves up to $990 annually through refinancing.

If you can find a loan refinancing with a lower interest rate, you’ll save large amounts from your monthly payments.

What Is Auto Loan Refinancing?

In simple words, refinancing a car loan means taking out a new loan to pay off the old loan. Since the motive of refinancing is to save money, you should find a new loan with a relatively lower interest rate to save up.

Since refinancing is similar to taking out a loan, the whole process is similar to applying for a personal loan. It requires you to have a well-off credit score and search for the most competitive interest rate to benefit from it.

If you think you are ready to shop for refinancing offers, you should be aware of these misconceptions. Understanding the refinancing details is the best way to get succeeded and, most probably, save money.

Here are the top five repeated misconceptions about auto loan refinancing:

Misconception #1: Auto refinancing is a time-consuming process

Whenever you plan to resell, trade, or refinance a car, you should be well aware of its value and cost. The value is what determines whether you will get a good deal or not. Since refinancing is taking out a brand new loan, you will have to get your car graded beforehand because it is the factor that will decide on the interest rate. The better the condition of the vehicle, the lower the interest rate.

Don’t you worry! Appraisals are very convenient, all thanks to efficient online sources. Your lender will look into the car model, mileage, trim, condition, and history and take care of the appraisal.

Misconception #2: Refinancing is inconvenient

Getting the ideal refinancing deals requires research and effort. But your lender will offer great help to make this process easier.

As you have heard, refinancing requires a visit to the DMV, but like an appraisal, your lender takes care of it. However, if you choose (company) for refinancing, we’ll have you covered. You will not have to stress over the appraisal and visit the DMV with us.

In general, you only have to go through the following few steps to get your auto loan refinanced:

Pre-qualification: Check your credit score to determine whether you qualify or not. A soft inquiry doesn’t affect your credit score at all.
Credit application: Once you’ve applied to refinance, a hard inquiry will take place.
Finalization: You have to submit any extra information, such as car titles.

Misconception #3: Refinancing requires a large sum of money

Since refinancing helps you save money, the fees related to the process are low as well. These fees include re-registration and lienholder fees, which are entirely inexpensive, and your lender will take care of it.

Important: Before going for refinancing, make sure that your balance is free from any prepayment penalty cost.

Misconception #4: After purchasing a car, you need to wait to refinance the car

This misconception is not true at all. You can refinance right away after purchasing a car or, you can also refinance before making the first car payment.

One reason to wait for 6 months before refinancing your loan is your credit score. Let it bounce back to normal, so you can effortlessly refinance to tackle all the hassles.

With CarLoanRefinancing, there is no time limit set for refinancing an auto loan. You need to be eligible for the set criteria.

You can look into the eligibility criteria on our website or contact the customer help center.

Misconception #5: Refinancing lowers your credit score

Your credit score may indeed dip down once your credit undergoes a hard inquiry. But remember that it is temporary. The effects of this hard pull would disappear within two years only.

Auto loan inquiries are grouped as single inquiries within an assigned time. For example, VantageScore provides you with a short rolling period of 14-days while FICO gives you a period of 45-days.