What Is Auto Refinancing and How Will it Help Me?
When you refinance your auto loan you are essentially restructuring your debt to more favorable terms in most cases. Our goal at Gravity Lending is to help locate the best rates and terms possible for our members.
- Lower monthly payment – Refinancing can reduce the monthly payment as a result of a lower interest rate, longer-term, or both.
- Lower interest rate – A reduced rate, with the same or shorter loan term period, typically means you will pay less total interest over the life of the loan.
- Longer loan term – Depending on the interest rate, increasing the loan duration will reduce the monthly payment.
- Shorter loan term – Conversely, shortening the term could increase the monthly payment but reduce the total amount of interest you will pay.
There are numerous reasons why a consumer might want to refinance an auto loan, but it’s usually a cost-cutting measure.
Reasons to consider refinancing your auto loan:
- Your credit score has improved – Numerous factors go into making an underwriting decision, but the score is a primary driver for lending institutions. A higher score may qualify you for a lower interest rate and APR.
- Market rates have fallen – Even a drop of one or two percentage points could result in significant savings.
- You accepted a loan from the finance department of an auto dealership – The rate offered when you purchased your vehicle may not have been the best available. Especially if rebates or discounts were offered in order to lock in the rate.
- Buying out your lease – Either on schedule or ahead of time.
If you aren’t sure you were given the best deal at the dealership – Get prequalified with Gravity Lending without affecting your credit. Refinancing with Gravity Lending will get you the terms you have earned.