Are you one of the people who asks this question, “Why do I have to refinance my car?” The answer to that is yes. The lower the rate, the less it is for you to borrow. Just remember the general rule that the interest rate must be 1 and ½ points lower than what you are paying. If yes, then it is indeed time for you to go on say, “I will refinance my car.”
But you have to be sure that the cost for you to refinance will cover the remaining years that is left in your loan. In layman’s terms, this is not the years left for you to pay, but the remaining years you want to own your car.
You have to make sure that if you want to go on and declare, “I will refinance my car” that your monthly savings are enough and will not incur closing costs.
Normally you can count up to 1 to 2% of the new loan that amount to all the closing fees and adding up to your title insurance. Just make sure that your lender will estimate all the closing costs and help you when you come up to him with the suggestion, “Can you assist me as I refinance my car?”
The lender must justify your refinancing through your closing costs. These must be recovered in the life of the new loan.
This is how it is calculated, the closing cost is divided by the number of months you intend to own your car and the result is added to the new monthly principal as well as the interest payment. If you think you can break even then you can go on with your plan and declare, “I will refinance my car.”
You can ask loan consultants to help you compare the possible expenses you will incur whether you say yes to, “Should I refinance my car?” or no to that same question. Either way, you have to be eligible for the various loan programs. You have to consider all your options.
Bad credit of refinance auto loans may mean that you have to pay more than what you should. Refinancing auto loans is specifically tailored for you to negotiate whether you go with the transaction or not.
If you do choose to go with the transaction and proceed with your plan to, “I will refinance my car,” you have to at least save more than what you were initially saving when you were still with your previous lender.