We all love our cars. They take us everywhere we want to go. Whether you have a two-seater convertible or a full-size minivan with 3 rows, we depend on our vehicles for transportation. But, have you ever considered the amount of interest you’re currently paying for this luxury? Does it seem like the payments are on a revolving door? Well, we’re here to help you consider a few things about your current car situation. Let’s discuss why a credit union is the best place to refinance your car.
When should you refinance?
You should refinance when it makes financial sense. If you are able to obtain a better rate and the total cost out of pocket would go down, then it would be good to refinance. Remember, each time you apply for auto loan refinancing, it impacts your credit score. This is why most applicants use a loan calculator before trying.
In a small number of cases, refinancing would lead to little or no difference in payments. Hence, it’s best to consult with a local loan manager to help with the process.
Some factors to take into consideration:
– Current interest rates
– Your credit score
– How long is the new loan for?
– Total out of pocket before and after
– How much longer do you have on your current loan?
Many people benefit from auto loan refinancing. This is because their monthly payments are lowered and their coverage is improved by perks such as GAP protection. The key is to research what makes the best sense for you.
Why is a credit union the best place to refinance?
Credit unions are great for refinancing because they typically provide better rates. Unlike banks, credit unions are not-for-profit. Instead of paying out a small group of investors, credit unions spread the wealth by offering incentives such as reduced fees, discounted loan rates, and small dividends.
Here are some advantages when you refinance your vehicle specifically through Achieva Credit Union:
- Low fixed variable rates on new and pre-owned vehicles
- Great financing opportunities and a variety of terms
- No pre-payment penalties
- Guaranteed Asset Protection (GAP) and Mechanical Breakdown Protection (MBP)
- You can apply online, by phone, at a branch, or even at some local dealerships
Mistakes to avoid:
There are a few things you want to avoid when auto loan refinancing. Keep these items in mind as you examine switching to a new lender.
Prepayment penalties- Before you switch, make sure your current loan doesn’t have prepayment penalties.
Stretching out the payments- A longer-term on a refinancing loan may mean you’ll end up paying more.
Going in the red- Will the terms of your new loan have you paying more than what the car is worth?
Waiting too long to refinance- Rates are usually best on newer vehicles, and some lenders won’t refinance loans for cars over a certain age.
Missing payments- Once you make the switch, verify with your old lender to make sure all payments/debts have been cleared.
Now is a good time
If you’ve read through this article and thought now is a good time to refinance, click here for an application. Your car is important and helps you get where you need to go. Wouldn’t it be nice to save some money along the way? Auto loan refinancing takes only minutes. Contact us today, we’re the best place the refinance your car loan.
Nerd Wallet, Auto Loan Refinance Calculator: How Much Can You Save?
The Balance, When to Refinance a Car Loan