Refinancing Auto Loans: Feasible For Those With Bad Credit

2007-03-08 10:33:40

( Automobiles )



Everyone is aware of the fact that a home loan can be refinanced, but not everyone realizes the possibility of refinancing auto loans. It is even possible to apply for auto loans with a bad credit score.

Similar to refinancing a home loan, refinancing auto loans pays for the old loan in full and a new loan with a new set of terms and conditions takes its place.

It could be time to submit a refinancing auto loan application if you have been making timely payments on your current loan for over a year and the value of your car is higher than the current balance of your auto loan.

There are some techniques you can follow in order to help increase the chances of obtaining an approval for refinancing auto loans even with bad credit:

You should consider finding yourself a co-signer. The co-signer should have a better credit score that you do, in order for you to be awarded better interest rates.

Take a look at your credit report. If you find any inactive bank accounts or reports of credit cards that have not been active during the last number of months, cancel or close them. Read through your credit report and make sure that all the information that has been recorded has been accurately reported. Any errors must be reported to the credit bureau.

Besides your credit information, your credit report will also contain information on all your debts and cash assets. Settling some of your debts also helps raise your credit score, which will help in obtaining better interest rates.

Finally, when completing an auto loan application, provide accurate and honest information about your credit records. Any inaccurate information can be a cause of a rejected auto loan application.

Approvals for refinancing auto loans can be received quickly. A check is normally delivered within a few days after a notice of approval has been sent to you.

Refinancing auto loans should be done through another lender. There are a number of auto refinance lenders available on the Internet. It is just a matter of approaching them and requesting for quotes. You must also ask the lender for information on the criteria to qualify for auto loan refinancing before requesting for quotes.


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