Auto Loan Refinance Myths
Refinancing is when you replace your current car loan plan with one with different terms. This is an excellent option for those who find themselves in a better situation than when they financed their vehicle in the first place or if interest rates have dropped. Refinancing has become commonplace nowadays, but there are still some misconceptions that may lead people to question whether it is the right plan of action. Keep reading to learn more about auto loan refinancing misconceptions. Then, feel free to contact us with any questions.
Myth: Low Credit Scores Won’t Get Approved
Building up your credit is one of the many benefits of financing your vehicle. If you started with a low credit score at the start of your financing plan, you might be considering refinancing to get a better interest rate. However, don’t be discouraged if your credit score still isn’t the best. Lenders look at other factors to determine if you will be approved, and there’s no downside to trying.
Myth: Refinancing is Stressful and Won’t Save Much Money
Depending on your situation, refinancing can save you a lot of money in the long run. If interest rates have dropped since the start of your loan, refinancing can save you a considerable amount on your monthly payment and even help you pay off your auto loan early. However, extending your loan term when refinancing could even out or cause you to pay more in the long run. So, be sure to do the calculations or contact a certified financial advisor before you begin the refinancing process.
Myth: It’s Not Worth Shopping Around for the Best Rates
Interest rates vary from one lender to another. If you are considering refinancing, looking around for the best interest rates to maximize your savings is a good idea. Before deciding, ensure you research the various lenders first and assess their interest rates, potential fees, and credible reviews.