Car Loan Refinancing Explained
Car loan refinancing is the process of acquiring a new loan, hopefully with better terms, to pay off your existing loan. If done correctly, refinancing can save you hundreds of dollars over the life of the loan.
Refinancing can be a great financial decision, but is not one to approach without proper knowledge. Use this page to help guide you in your car loan refinance journey.
Why Refinance Your Car With LendingTree?
As with any type of loan, you should want to get the best deal possible. By using LendingTree to refinance your car loan, you’ll receive multiple offers from our top-rated lenders, allowing you to take control and select the best deal for you. Start comparing lenders now and find the best opportunity to refinance your car loan.
Frequently Asked Questions›
- What does it mean to refinance your car?
What does it mean to refinance your car?
Refinancing your car is the acquiring of a new loan in order to pay off your old one, with the goal of gaining better terms, such as a lower interest rate, on the new loan. When you refinance your car, you transfer the car's title from the original lender to the new one and begin to make payments to the new lender.
- When can I refinance my car loan?
When can I refinance my car loan?
You can refinance your car loan virtually as soon as you would like. Because the majority of the interest is paid in the beginning of the loan, the earlier you refinance, the more productive it can be. However, if your car is too old, you may not be able to refinance. If you are able to refinance, you should be aware of becoming "upside down" on your loan, which means you owe more than the car is worth.
- How does refinancing a car work?
How does refinancing a car work?
When refinancing a car, you use a new loan, hopefully one with better terms and often with a different lender, to pay off your old loan. You then begin to pay your new lender for the new loan.
- How much will I save by refinancing my car loan?
How much will I save by refinancing my car loan?
How much you will save can vary based on factors such as the difference between interest rates, the loan term, and the balance of your current loan. If done correctly, refinancing can save hundreds. You can use our auto refinance calculators to help figure out whether refinancing will save you money.