#Auto loan refinance calculator drivers#

Check current auto loan rates to see how much you could potentially save with lower refinance rates. If you used dealer financing, you could be eligible for better loan terms with an outside lender. You financed your current loan with the dealership. This is especially true if you originally financed through a car dealership.

Better credit will mean more favorable terms. Your credit has improved since taking out the current loan. However, you may be able to request a loan modification from your current lender without refinancing. Refinancing and reworking your current loan’s terms can give you more time to pay off your vehicle or a lower rate. You’re struggling to afford monthly payments. There are a few primary scenarios where it is a good idea to refinance your car loan.

When it’s a good idea to refinance your car loan To best determine your ideal term length, use an auto loan refinance calculator to find the one that will best balance the money saved and monthly payments you can afford. The term can be shortened or made longer - and the right choice depends on your budget. But with a longer loan, you could be stuck paying hundreds of dollars more in interest than you would with a shorter loan.Īlthough you can get a different interest rate, the term change is the main factor in whether or not you effectively “reset” your loan. The longer your term, the lower your monthly payment will be.

#Auto loan refinance calculator drivers#

The most common terms drivers are met with when financing a vehicle range from 24 to 84 months. You’ll generally pay the most interest in the first few years of the loan, minimizing the potential cost savings you’d get if you refinance towards the end of the repayment period. However, refinancing may not be beneficial if you have less than 24 months remaining on your auto loan. And, with a lower interest rate, your payments should also be lower. This will prevent you from paying additional interest. So, if you have 36 months remaining on your loan, you would refinance to a 36-month loan. You can avoid adding too many additional payments by choosing a term that is the same or shorter than the remaining term on your current loan. But if you choose to extend the term, it may feel like you’ve restarted the loan, even if you’ve been making payments for some time. If you decide that refinancing your loan is the best financial option for you, the new terms offered could make your monthly auto loan payments more affordable. However, refinancing may not be a complete solution if you have a larger financial problem. But opting for a longer repayment period on a new loan could make you feel like you’re starting from scratch. You could get a lower interest rate and shorter or longer term than you currently have. Refinancing swaps your current loan with a new one. If you are struggling to make your monthly payments but cannot secure better rates through refinancing, consider requesting loan modification. To find the best new loan for your needs and ensure you're saving money, it's smart to use an auto loan calculator. Refinancing your auto loan can save you money by giving you new and better rates and terms.