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Consider refinancing if you're unhappy with your current auto loan or your circumstances have changed.
If you’re struggling with a higher interest rate or an expensive monthly payment, refinancing could be the answer to finding a better deal with a lower payment.
In fact, research suggests that Americans could save more than $37 billion by refinancing their current auto loans. Read on for the top five reasons to say “Yes!” to refinancing.
Refinancing your auto loan means taking out a new loan to pay off your existing one. The goal is to save money in the short and long term. Refinancing also allows a second look at protections you may have initially passed on when buying your car.
Refinancing your auto loan offers many potential benefits that can significantly add up over time.
If you financed your car without negotiating the rate, you likely didn't secure the most favorable deal available. Poor credit can also lead to high monthly car payments. You might be able to get a better loan rate if interest rates have dropped or your credit rating improved.
Check with your local credit union to get the best deal possible because credit unions typically have much lower rates than banks. Many institutions, like Baton Rouge Telco, offer discounts of up to 0.50% APR for having an established relationship.
Refinancing could help lower your high monthly car payments. It can act as a proverbial pressure relief valve that frees up money and takes some of the stress out of paying your bills. However, be aware you may end up paying more interest over the life of the loan.
Refinancing could offer a faster payoff if you want to pay off debts or worry about your car outlasting its loan. This strategy helps align your loan term with your financial goals and your vehicle's lifespan.
Consider refinancing your car at a lower rate for a shorter loan term. This may keep your monthly payments the same or even increase slightly. However, you’ll be able to pay off the vehicle much faster.
If you financed at a dealership, you were likely offered GAP coverage or mechanical breakdown protection. It’s easy to pass on these options when you’re focusing on the excitement of your new car.
But now that you’ve had time to reflect, you may wish you had added some of those protections. Refinancing is a great way to add these policies so you can have better peace of mind.
Not all lenders are created equal. It’s frustrating when it becomes a hassle to get hold of someone to answer your questions. Many big banks make their customers feel more like an account number than a person.
Refinancing through a credit union like Baton Rouge Telco will provide you with more personalized service. Our customers love our easy online payment options and the ability to walk into any local branch and talk to a human being.
And that human will probably greet you by name—imagine that!
Refinancing your auto loan opens up many opportunities for savings. Consider a situation where your original used car loan carried a 9.33% interest rate due to your less-than-stellar credit score. As time passes, your credit score improves.
You decide to refinance and obtain a 7.43% interest rate. This improvement makes your auto loan more affordable and has a significant positive effect on your finances. Let’s look at a comparison between your original loan terms and your new loan after refinancing.
Refinancing from 9.33% to 7.43% would lower your monthly payment by about $18. You would save approximately $1,097 in total interest over the life of the loan.
Refinancing is a great way to reduce your monthly payments or shorten the length of your auto loan. It offers a path to better align your loan terms with your current financial situation and goals.
At Baton Rouge Telco, we offer competitive auto refinancing rates and flexible terms to our members. Our friendly experts will sit down with you to go over the rates, terms, and available options that align with your financial goals.
Check out our auto refinance program and contact us today to learn more!
Federally insured by NCUA. Your savings federally insured to at least $250,000 and backed by the full faith and credit of the United States Government – National Credit Union Administration (NCUA), a U.S. Government Agency.
