Choosing to finally purchase that dream car is always an exciting decision to make. At Members 1st of NJ, financing your new or used vehicle with the help of an auto loan can relieve some of the stress associated with making a big purchase, and the application process is simple. But what about current vehicle loans weighing you down with high interest rates and pricey monthly payments? Don’t fret — your wallet has the potential to get a bit heavier through the process of refinancing your auto loan.
What Does Refinancing an Auto Loan Entail?
The goal of refinancing an auto loan is to lower your monthly payment by switching to a lender with better rates. Every bank or credit union has its own refinancing requirements, which are dependent on your vehicle’s age and/or miles and your creditworthiness. While your current lender’s auto loan rates may seem fair and comparable to that of competing institutions, prepayment penalties are also a hidden cost to consider. Many customers choose to refinance their auto loans because of the large fee associated with paying off those loans early.
The Benefits of Refinancing Auto Loans
As is the case with most refinancing options, the overarching advantage gained when you refinance an auto loan is more money in your pocket. Individual benefits include lower monthly payments, a better APR % (Annual Percentage Rate), and longer loan terms. Personal finance factors such as an improved credit score or a cut in your monthly income can also contribute to a refinanced auto loan that is more manageable. Since auto loan refinance rates are based on creditworthiness, a higher score should prompt you to take a closer look at the terms with your current lender.
Refinance Your Auto Loan with Members 1st
At Members 1st, our competitive vehicle loan rates are enough to entice you to take that first step in financing a new or used car, ATV, boat, or RV. But if your contract with a different lender is making monthly payments difficult, becoming a member at our credit union can help open doors to increased financial peace of mind. Fill out our online refinance application or call your branch location and start saving today!