When interest rates decrease, the possibility of saving money on an existing loan increases if individuals choose to refinance. Though many consider refinancing a mortgage, few contemplate the savings of refinancing an automobile loan. The process involved requires much less hassle and pain than consumers realize and could save hundreds of dollars annually, if not more. Various scenarios determine whether an auto refinance loan is right for you.
Individuals who purchased vehicles at 11% to 18% interest rates, save thousands of dollars overall and reduce monthly payments by substantial amounts. Completing online loan applications requires approximately 10 minutes of time. There can be many reasons accompanying the decision to refinance an auto loan, but most want to refinance for the savings involved. It all depends on your personality.
The Conscientious Spender
These individuals continuously watch the economy with a watchful eye and take advantage of bargains. When interest rates drop, the opportunity presents itself to improve personal finances by obtaining loans at reduced rates. Some consumers may have been at the mercy of an unsatisfactory credit rating, which resulted in less than nominal interest rates. Once credit reports improve, these persons can take advantage of loans with reduced rates.
Avoid Being a Remorseful Buyer
The thrill and excitement of owning a new vehicle wears thin when consumers realize dealers looking to score a profit have duped them into paying inflated interest rates. Refinancing at reduced rates undoubtedly saves these people money over the long haul of their loan.
Some individuals acquire vehicles through short-term loans in order to pay a loan off within a shorter period. Along the way, the person makes additional purchases, incurs unforeseen debt, or experiences a change in employment. These people opt to lengthen a short-term loan over an extended period in order to reduce monthly expenditures.
Lease to Purchase or Rent?
Certain consumers opt to lease vehicles in lieu of purchase. When the lease agreement expires, some opt to keep the automobile for a variety of reasons. In this situation, individuals save time and money by acquiring a loan through an independent lending institution. Purchasing a vehicle in this manner prohibits the possibility of auto dealers to add inflated interest rates or other hidden fees.
Many websites offer the opportunity to investigate national, regional and local interest rates. Having access to various lenders, rates and fees helps you refinance with confidence.