If you’ve been struggling with excessive car payments, then refinancing your car loan may be a good option to consider. Car refinancing can provide significant benefits, including a lower interest rate and lower monthly payments.
Often, the money saved each month with your lower payments can be instrumental in helping you pay the rest of your bills.
1. Refinance Duration Insights
You might be curious about how long it takes to refinance your car. If you’re facing financial challenges, starting to save money sooner is crucial.
- The good news is that the car loan refinancing process is generally quick, typically taking between two hours and two weeks.
The duration depends on your preparedness before applying and the specific lender. Some lenders can process your application in a few hours, while others may take more time for a thorough assessment.
2. Benefits of Refinancing Your Car Loan
Refinancing your auto loan can offer several significant advantages, including:
2.1. Lower your interest rates
- One of the key motivations for refinancing is to decrease your interest rate.
- This is typically achievable if your credit score has improved since you acquired the automobile or if you did not search around for the best conditions when you took out your previous loan.
2.2. Reduce your monthly payments
- Lowering your monthly payments can frequently help you add more money to your budget.
- This can occur in two ways. You can reduce your payments by getting a lower interest rate on the same loan term as your current loan.
- You may also prolong your loan term to lessen your monthly payment, but this will cost you more money throughout the loan.
2.3. Skip a payment or two
- Most of the time, you will be allowed to defer making a payment while your current loan is being paid off and the new auto loan is being processed.
- This can provide you with a sizable increase in income for those months, enabling you to pay off other debt or catch up on payments.
3. Hacks to Speed Up Your Auto Refinancing Process
While the lender will determine how long it takes to refinance your automobile, you may make efforts to expedite the process. The better prepared you are before applying, the smoother the process will be.
Make sure you have all of the essential papers in advance. This includes:
- Driver’s license ID
- Proof of Income
- Credit history
- Evidence of employment
If feasible, digitize these papers to speed up and simplify the document upload process.
Bonus: Raising your credit score will help you qualify for better rates
- Your credit score greatly influences the interest rates you qualify for when refinancing. A score of 700 or higher ensures competitive rates, and even a modest 40-50 point increase can lead to significantly better terms.
- Making timely monthly car loan payments is an effective way to boost your credit score. Within six months to a year of consistently meeting payment obligations, you may observe a substantial increase in your credit score.
- To quickly raise your credit score, review your credit report for errors. Disposing of and rectifying mistakes with the credit bureau can promptly enhance your credit standing.
4. BestAutoLenders Makes Car Loan Refinance Easy and hassle-free
If you’re considering refinancing your car loan, BestAutoLenders can help.
- APR from 3.2%
- Get approved in as little as 60 seconds
- Bad credit and no credit welcome
- Various vehicle options
- Absolutely no obligation
With our unique approach, you’ll be paired with a loan consultant who will take the time to get to know you and understand your refinancing goals.
- They can process your application wherever you’re applying from in the U.S.
- Their loan experts will then compare loans for you using our network of nationwide lenders in over 50 states to identify the best options that align with your specific goals.
Apply now to get the car loan refinance process started.