Posts Tagged refinance

When to Refinance Your Car.

In this economy, which is enduring a slow recovery, interest rates hit historic lows, but are once again beginning to slowly climb again. As this goes on, the word “refinance” is on many people’s lips. On down from mortgages to car loans, people are looking to grab up on the lower interest rates while they can. But what situations are the best for you to refinance your car? Let’s look at the top few.

Lower Interest Ratesrefinance your car

With interest rates down, you might find that the prime rate for your vehicle could be lower than the one you currently have. If you’re paying 6% interest, and you can get a 5% rate, you should go for it—you may be able to save a lot of money over the life of your loan. In fact, if your rate is currently 6%, you should absolutely investigate refinancing, as lower rates are available.

Improved Credit Score

If your credit score was not ideal when you first took out your loan, and you have taken steps to improve it, refinancing might be a great way to take advantage of your newly-risen score. If you purchased a car with credit problems, your interest rate was almost certainly sub-prime; refinancing can get you a lower rate, which can save you money in the short and long run.

Financial Hardship

If you’ve encountered a period of financial hardship and need to reduce your bills, but your credit rating hasn’t yet taken a major hit, go for a refinance. Again, grabbing a lower interest rate through refinancing your car loan can mean lower monthly payments, which could enable you to manage one or two more bills per month.

Expiring Car Lease

If you’ve been leasing a car, generally you have three options:

• Turn in the vehicle and walk away
• Turn in the vehicle and lease a new one
• Finance the vehicle’s remaining cost and buy it outright

If your car is in good shape, has been reliable, and you like it, you can find a lender that refinances the vehicle and get a good interest rate on buying the vehicle. The only risk in this case is that you still may be paying on the car loan after the vehicle’s warranty expires. But if you drive the car lightly and feel it to be reliable, refinancing your car can be a great approach to owning your formerly-leased vehicle.

Remember, refinancing your vehicle can save you hundreds or even thousands of dollars over the life of your loan. If the circumstances are right for you, investigate this as a strong option to lower your monthly payments and save money.

Posted in: Company News

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Three Scenarios When Refinancing Your Auto Loan Makes Sense

blog-refipayment-three-scenarios-when-refinancing-makes-sense

Let’s face it: we live in a credit-based society. You need credit to do just about anything from purchasing an appliance to buying a house. We also live in a society where in many places owning a car is almost a necessity. Since the economy is so difficult these days and it can be so hard to keep a solid credit rating, many folks obtain financing for a vehicle at less-than-ideal interest rates. There are, however, situations in which it can be advantageous to seek a refinance deal for your auto loan.

Lowering Interest Rates

The economy is in flux right now, with interest rates on a trampoline of up and down. If you can catch it at just the right time, when rates are at a low point or down swing, you could save significant money on your monthly payments. This works in a few ways. Firstly, the obvious: rates have gone down. If you financed at 11% and rates have dropped by 4 points, you could refinance at 8% or less, saving at least 3% on your overall payments.  Remember, though, that refinancing your auto loan generally counts as used car loans rather than new, so even if you purchased your car new, it will now be financed otherwise, which means slightly higher rates overall.

Improvement on Your Credit Score

It’s possible that when you purchased your car your credit score was less than ideal. Perhaps it was your first big purchase and you had no credit score to speak of. Perhaps, like many folks, you simply had a few black marks on your credit rating—a missed bill here, a late payment there. Now, however, several years have passed and you’ve gotten your credit score in top shape. It might be an ideal time to refinance, as with a higher credit score you’ll most definitely score a more advantageous loan rate.

Lease-to-Own

Perhaps you’ve taken on a lease agreement, to take advantage of lower monthly payments, but now your lease is up and you want to buy the car outright. This is almost always an option, but standard agreements continue the payment structure as it was, which may not always be the best interest rate. You might want to look at other options for refinancing—the dealer may not renegotiate the rate, but third-party lenders can often be a source of lower-interest loans that can be used to buy your vehicle at the end of a lease.

Posted in: Company News, RefiPayment News

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