Is a Car Refinance Loan Right for You?

Refinancing your car loan can potentially save your lots of extra money each pay day. But, you have to consider a number of things before you make an auto loan refinancing decision. While refinancing your car may seem like a good idea, there are some pretty narrow qualifications. These restrictions can range from the mileage on your vehicle, length of time until pay off, the type of car, and even who the original lender happens to be. And, yes, loans are available right now at some very good rates; but will the maneuver really save you money?Choosing a Lender for Car Loan RefinancingAnyone in their right mind wants to find ways to save money. While car refinancing seems like a good way to do just that, they really do not work for everyone. Lenders in the business of refinancing auto loans are really only interested if the first loan originated from another lender. So do not go to your original lender, everything is fine with them just the way things are. That being so, it is important to know of any affiliates of the original financier and avoid them as well. But, lenders in the auto loan refinancing business are very interested in new business. Shop around and look at the rates each lender is offering and take a close at the restrictions they may have on underwriting a car loan refinance. Look for a lender that is willing to work with you and your car loan situation.Restrictions May Apply for Refinancing a Car LoanOften, lenders do not want to refinance vehicles that are used in commercial activity or that are owned by a company or firm. Of course, the age of the vehicle is a fundamental consideration, most finance companies do not want to be bothered with vehicles older than five or six years. Refinancers want to know how long you must still pay under the original. These lenders are not too concerned about the value of the car. Indeed, knowing the value of your vehicle is important, but you do not have to have your car appraised before you seek refinancing. What you still owe is the biggest determining factor on whether or not you will save money with refinancing. Lenders interested in refinancing would like for the amount still owed to be around $7500. Owing somewhere between $7500 and $10,000 is an optimum for refinancing.The Last WordOne way to thoroughly scrutinize your refinancing realities is to use a car refinance calculator. Yes, you can find them on the Web at a number of sites. They can help you really put the numbers in front of you as you consider refinancing your auto loan. If you have less than a year left on your payments, the time and trouble to obtain a refinance deal may just not be worth it. You do not have to worry abut the equity in your car -- it does not really matter what you have already paid. The major considerations are how much you still have to pay and how long you have to pay it.