How to Refinance a Car Loan

Refinancing Paperwork

Are you paying too much interest on your auto loan? Many Macon and Dublin-area drivers are able to lower their interest rates by refinancing. In this guide, we'll go over what you should know about how to refinance an auto loan and how to determine whether it might work for you.

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What's the Best Way to Refinance an Auto Loan?

Refinancing a loan means you apply again for financing with the goal of obtaining better rates. Why might applying for a second time result in lower interest rates? You may have found that other lenders are offering better rates, or you might suspect that you'd be approved for better rates now because your credit score is higher than it used to be. Whatever your reasons, here's what to know when refinancing your car:

  • Find out if your credit score is better, and by how much.
  • Apply to a wide variety of lenders in the Warner Robins area. With many offers to choose from, you have a better shot at securing lower rates.
  • Loan applications can damage your credit slightly, so send all of your applications within a 14-day period to minimize this effect.
  • Consider what length of loan term works best for you. Shorter loan terms cost more each month but result in less interest paid overall. Longer terms are more affordable each month, but more interest is accrued over the course of the term.

What to Know When Refinancing Your Car: Potential Drawbacks

How do you refinance a car loan if you're underwater on your loan? Actually, not all drivers in Warner Robins will benefit from refinancing. It may not be worth the effort if any of the following apply to you:

  • Your current loan agreement charges fees for refinancing.
  • You owe more on your car than it is currently worth.
  • You drive an older car that has already experienced major depreciation.

Explore Your Auto Financing Options at Five Star Lincoln Warner Robins

If you have any additional questions about how to refinance a car loan, please don't hesitate to speak with an auto financing expert at Five Star Lincoln Warner Robins-we're here to help you lease or finance your vehicle as affordably as possible. Don't miss out on Lincoln global incentives and exclusive dealership specials when you're in the market for your next new ride!