How long refinance car loan

Some banks, credit unions , and other lenders reward loyal customers with low rates. They may also offer special deals to attract new customers, especially those unhappy with the car loan they got at their local dealership. Many lenders will require you to wait at least one month before refinancing, along with their specific requirements to take out a new loan.

Some lenders may require three to six months of on-time payments before refinancing. Believe it or not, you may be able to refinance right after you buy your car. There is no set amount of times you can legally refinance your car. However, each lender may have its own rules. For example, you may not be able to refinance multiple times with the same lender or broker. It can allow you to save money on interest, lower your monthly payments, or pay off your car sooner than you ever thought possible.

If you decide to refinance soon, be sure to compare lenders, rates, and terms so you can score the best loan for your unique needs. She is passionate about helping people from all walks of life make good financial decisions. To see a benefit from auto refinancing, you should have at least two years remaining on your auto loan. With most interest paid in the beginning of a loan term, there's less potential for savings if you refinance too late in the term.

Also, most lenders have refinancing requirements that come into play later in your loan. These differ from lender to lender and usually include the number of months left on your loan term, the remaining balance on the loan, the age of the car and its mileage.

When you apply to lenders, be sure to ask about their specific requirements for refinancing. Regardless of when you refinance, you should take time to apply with multiple lenders and get more than one offer. Comparing refinance offers with your current auto loan can help you decide whether to refinance your auto loan at all. Our auto loan refinance calculator below can help you compare offers. You're most likely to benefit from auto loan refinancing in these situations:.

Your credit score has increased since you took on a car loan. Applying for prequalification can be a good place to start. To get prequalified, the lender will look at certain information, like your credit and type of vehicle. Check around with several lenders and compare the interest rates, loan terms and total cost of borrowing available to you.

Find out if any of the loans qualify for an autopay discount. You may be tempted to choose an offer with a longer loan term, which could result in a lower monthly payment.

This is where the documentation you gathered can come in handy, as you may have to provide it in the application. This application will count as a hard inquiry, which can lower your credit scores by a few points. If your loan is approved and you sign the loan paperwork provided by the lender, you should get a document from your lender with all the terms of your new loan. Depending on your lender, much of the transition from your old loan to your new one can be taken care of by the lender.

For example, your new lender might pay off your old loan. Once your original loan is paid off, you can focus on making on-time payments on your new loan each month, which may help boost your credit. Refinancing can be a great way to find an auto loan that best fits your needs.

Extending the life of your loan can also lead to your loan being upside-down. Put another way, you may owe more on your car than it is worth. Prepayment penalties still exist , and you might have to pay extra if you pay a loan off before the term is up.

Penalties can eat up any savings you get from a lower interest rate. If you run the numbers and you determine that it makes sense to refinance, waiting can cost you. Used car loan rates are typically higher than new car rates.

Any late payments will hurt your credit and your ability to refinance. To get a new loan, you need to apply with a new lender. In most cases, the process is relatively painless—your lenders work together to handle the logistics, and you simply need to submit an application. To prepare:. Submit your application, along with any required documentation, and respond to any lender questions.

Many lenders can provide an approval decision on the same day you apply, or within a few days. Any lender with competitive rates and fees is worth a look. Online lenders are another good source. You can take care of everything whenever and wherever it is most convenient, as well as find excellent rates online. When lenders make inquiries into your credit, your credit scores drop slightly. You may be able to refinance a car loan with bad credit, but if your credit is worse now than it was when you got the original car loan, then refinancing might not benefit you.

A lender is unlikely to give you better terms with a refinance if your credit score has dropped. You can refinance a car loan as many times as you can find a lender willing to refinance it for you. However, repeatedly refinancing within a short time could be seen as a red flag by lenders.

The two main costs of refinancing a car loan are the lender fee and the title fee.