When Should I Refinance my Bad Credit Auto Loan?

People who obtain auto loans with poor credit often fear that they will never get out of that high monthly payment and interest rate, but that is not true. Refinancing your car loan can significantly lower your car payment and help you gain some equity in your vehicle. The big question is how long should you wait before refinancing your loan?

Surprisingly, you don't have to wait at all. The earlier you refinance the loan the more money you will save. This is because the majority of interest is paid within the first half of your loan; therefore, the longer you wait the more money you are spending.

On the other hand, if you have bad credit refinancing your loan may be better to put off for at least six months. This will allow you to make timely payments and start building your credit score back up. After six months of timely payments your score should have increased a few points, and you will be more likely to get an affordable interest rate on the refinanced loan.

Who Can Refinance My Loan?

Most lenders will not refinance their own loans right away. This is because the majority of lenders make money from the interest you pay during the first half of your loan term and refinancing the loan right away will result in the lender making less money. Your best bet is to use a different lender because you will have a better chance at getting a fair interest rate and save more money.

Here at SmallerCarPayments.com we have a network of auto loan refinance lenders that specialize in bad credit refinance. Our lenders have all the tools and experience necessary to get you the best and most affordable refinance rates on the market. If you meet our minimum requirements and you're ready to get on the road to lower car payments and better credit simply fill out and submit our online application.