Refinance Car When Current Interest Rates Are Low

2007-03-08 10:33:40

( Financial )



New car buyers are getting generous deals on their new car loan rates, with zero percent interest under certain conditions. But you may have bought your car at a time when interest rates were high, and you’re stuck with that. With current interest rates being much lower than they were, you may want to see if you can refinance car and save money.

If you wish to refinance car, you will need to have enough equity in your car. This equity will serve as collateral, since a vehicle refinance facility is essentially a used car loan. You may have sufficient equity accumulated in your car if you made a large down payment when you bought it (to get the best car loan rates at that time), or if you are more than halfway into your loan.

With enough equity, you can be a good prospect for refinance car loans lenders. Banks are not generally interested in refinancing car loans, however. You may have to try online lenders who get most of the business in the vehicle refinance market. Or, you could sound out a dealer on gmac car loan products.

You can try other modes of financing when you want to refinance car. If you are a member of a credit union, you may be able to arrange a refinancing car loan. You could also consider tapping a home equity loan, if you own a home, to pay off a high interest auto loan.

Wherever you refinance car, make sure that you refinance only if monthly payments are reduced. Otherwise, if the payments are still too high, you might consider selling the car and using the money to pay off your existing loan.

You can then use the difference to buy a new car and get a gmac car loan at the more affordable new car loan rates.


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