A: No, it’s not too late. You may still be able to save quite a bit in interest, especially if you financed your car through the auto dealer that sold it to you.
Financing through an auto dealer is convenient, but it doesn’t necessarily get you the best interest rate. Getting competing quotes on loans from several sources will help you find the lowest rate available and save money over the term of your loan. And it doesn’t have to take a lot of time and effort, if you shop for your loan online.
To save money on a car loan, try to refinance your loan for the same term or a shorter term. Your monthly payment may increase a bit, but you’ll pay the loan off sooner and reduce the total amount of interest you pay.
Refinancing can be very rewarding. If you refinance a $28,000 auto loan with an interest rate of nine percent with a new 5.75 percent loan, you can save $43 a month. That’s $518 a year, and $2,590 over 60 months.
Refinancing is a particularly good idea if you have an upside-down auto loan, or a loan for more money than your car is currently worth. If you are in this situation, you should try to pay your car off as fast as possible, and refinancing at a lower rate of interest can help you. With a lower interest rate, a larger share of your monthly payment goes to paying down the loan balance.
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