Far too many people with bad credit or no credit find themselves paying too much interest on a car loan. Recent high school and college graduates usually lack a good credit score, and while they might think that high interest rates are their only options, this isn’t always true. Those with an auto loan that has a high interest rate attached may consider looking at auto loan refinancing.
What is Auto Loan Refinancing?
Auto loan refinancing is an alternative to paying off an existing loan with a high interest rate. Refinancing companies offer to work with those who have loans from other companies and refinance the loan at a better interest rate. These loans are usually only available to those who have at least $10,000 left on their loans. Many borrowers find that they can significantly reduce the amount that they pay in interest over the terms of their loans.
Who Qualifies for Refinancing?
As lenders usually look at an individual’s credit history and credit score, those with a lower than average score will often have the highest interest rates. When they reduce their scores by even a few points, they have the chance to save a significant amount of money. Lenders in charge of refinancing often look at how much time remains on the original loan, the age of the vehicle and the number of miles on the engine. Most lenders will only offer loans to those buying a car less than eight years old with fewer than 100,000 miles on the engine. Check with online lenders such as carfinance.com today to see if you qualify.