Overhaulin'

Can we refinance a car loan with another bank to get a better rate and save money?

We have a car loan for $10,000 and a rate of 7.5%. We were looking for a better rate (to save some cash). Would it be possible for us to find a loan with another bank for a lower rate and pay our current bank off, in order to save money?

Public Comments

1. Yes it is! I've done that very thing. Check out interest rates and loan terms
2. Yes, it is certainly a good idea. Check out your local credit union or lendingtree.com for low rates.
3. Yes, the only problem is that you will probably be extending the length of the loan. That means you will be paying more for that car in the long run, by paying more interest. Try throwing 1,000 into the loan, that way you'll pay less interest for the life of the loan.
4. Yes, that is called refinancing your auto loan and depending on your financial situation you could save a good amount of money. Check out link brokers like rategenius.com and umbrellaauto.com to get your application shopped around to various lenders. But also go see your local credit unions. They have the best rates, you just have to be able to join. Doing those things should save you some time and hits on your credit. Refinancing can also allow you to skip a payment or two depending on the lender. It takes time between paperwork and payoff of your last loan. This could really come in handy during the holidays! But be sure to check out any deal that you are given and be 100% comfortable with it. You shouldn't have to pay an application fee, only title transfer fees if you go ahead with the refinance, and those are assessed by your state, not the company that refinances you. If you have any more questions about this process, please feel free to ask.
5. It is possible if you have positive equity in the vehicle. If your loan balance is greater than the vehicle's current value, you'll have to come up with the cash difference.