How to refinance a car?

Refinancing a vehicle loan allows you to take advantage of better loan terms including lower interest rates, monthly payments, or a shorter length of your loan. Refinancing a car is a relatively simple process and can help your finances in both the short and long term. Here we look at the process of how to lower your car payments through car refinancing with Broker4Cars and our partners.

How to lower your car payment...

1. Make sure it makes sense
   Before progressing with a refinance, you should ask yourself whether it makes sense to refinance? Consider the below when deciding if refinancing is right for you:
   1. Penalties and fees.
      
      1. Will you incur any penalties and fees if you refinance? Some lenders charge a fee if you pay off your current auto loan early.
      2. Is there an upfront fee when you refinance? Lenders' upfront fees can vary, so you should compare them with your potential savings to make sure it's worth it in the long run.
   2. Current loan balance.
      
      1. Is the balance on your current loan more than the value of the vehicle? If yes, then getting a new loan with better terms may well be challenging.
   3. Credit history.
      
      1. To get the best terms, your credit history should be in top shape ahead of applying for refinancing.
   4. Vehicle's age. There are lenders out there who won't refinance older vehicles - or those with high mileage; generally over 10 years old or 140,000 miles.
2. Examine your credit
   Through making on-time payments for all your bills - including car loans - it's possible that your credit score has improved. If this is the case, you will likely find that qualifying for refinancing is now easier. You can view your credit score through:
   • Free access to your credit report from Equifax, TransUnion or Experian. You can download these reports to examine your past credit history, including any black marks that may affect your score, unauthorized accounts, and incorrect info. Errors in your history may impact your score, so you will need to dispute them because if they can't be verified, they will remove them from your report.
   • Check with your credit card company, as many offer updated scores on your monthly statement or online account..
3. Collect important documents and information
   You will need to compile several documents before you fill out any applications. Here are the most common bits of information needed:
   1. Personal information
   2. Proof of income
   3. Vehicle and insurance information
   4. Current loan information
4. Compare offers
   Comparing offers from different lenders is the best way to get the most bang out of your buck (however, we are confident you'll find us the cheapest!).
   
   Here's a short list of details to consider as you compare offers from alternative finance providers:
   • Interest rate
   • Repayment terms
   • Fees involved
   • Any other factors that are important to you
5. Submit loan applications
   Now that you've completed the research and collected all of your important documentation that will help you lower your apr on a car loan, it's time to submit your applications. There are typically a few different ways of doing this, depending on the lender. You'll likely be able to submit your application online, but some smaller lenders may ask you to do it in person.
6. Check out your savings
   Using a car loan refinance calculator will help you see how much money you'll save each month and your total savings once you've paid off the loan in full. You'll just need to enter information about your current loan and the repayment terms for your potential new loan to see if refinancing will benefit you.
7. Evaluate loan terms
   Make sure that the loan terms are agreeable, and will suit your needs. If so, you're nearly set to finish the refinancing process.
8. Finish the process
   Once your refinancing loan application has been approved, you will receive the loan paperwork. Your new financial institution will then pay off your old car loan, transfer the title, and you will start making payments on your new loan.

How Broker4Cars can advise on how to lower your apr on a car loan

If you're considering getting refinancing your car, then Broker4Cars can help you secure a better deal.. Simply contact us on 01773 512806 or fill in the below form to see how we can help you.