When is the Best Time to Refinance Your Car

Why You Should Refinance Your Car?

so when the best time is to refinance a car ? and also why you should be doing it ? 
and so that's exactly what i'm going to cover in this article so that you guys can learn something new about when you should be refinancing your car and why so stay tuned and we'll go through everything

 so the first question of when you should refinance a car is very simple and you can refinance your car tomorrow if you want to and it really doesn't matter how long you've had the loan .
for now you're going to have to pay attention to two things here and they are just the rate and then your credit score that's all you really have to be paying attention to if you want to refinance your car

 so the first one your rate :

this is what you want to pay attention to if you feel like you have too high of a rate or that you can get a better rate right now then you do want to be refinancing your car 

the second thing is your credit score :

so if you got a car six months ago and you've made all your payments on time and you feel that your credit score is a lot higher than it used to be then definitely consider refinancing because you can always at least try to do it and see what happens and also keep in mind that when you're refinancing a car it is not nearly as complicated as refinancing a house so this means there's generally no closing costs associated with refinancing and a lot of the time it doesn't cost anything to do it .

so if you can get a better rate meaning an interest rate or your credit score you feel is a lot higher and you can get a better rate because of that then definitely consider refinancing because it's really easy and it's not nearly as complicated as doing it with your house.

 and then if for some reason you were told that you can't refinance your car for six months to a year this is not true unless it's actually stated in your contract which it probably isn't so for instance if your salesman told you you had to wait six months before you can refinance don't listen to that unless it's actually in the contract a lot of the time the salesmen they know that there's a back-end commission coming six months or a year from now so they want you to keep that same loan so that they can get their small commission but they're not telling you that they're just making you feel like you're contractually obligated to not be able to refinance and this is not true unless once again it's actually stated in the contract 

so really if you bought a car a week ago you can refinance today if you really wanted to

 now what i would recommend is if you are going to go refinance your car:

 i highly recommend that you check out your local credit unions and you check their advertised rates on the internet so you can see what to expect from all of the different credit unions.

 so for instance the easiest way to do this is let's say that you live in georgia just google refinancing a car georgia credit union and you can see what all of the different credit unions offer for your local area and that's the easiest way to find the best rates locally for you.

if you do end up refinancing your car just keep in mind that you are going to have what's called a hard credit pull and this is negatively going to affect your credit score just for a little bit but keep in mind this is totally normal for getting a loan because obviously the bank needs to know if you can pay them back .

if you are going to refinance don't make this 

the reason why you don't refinance because your credit score is going to go back up eventually i get a lot of comments of people saying that they don't want to refinance because they don't want to have their credit dinged and this is just something that you need to completely ignore because if you are going to save money then definitely just have your credit pulled it's going to eventually go up and i will explain a little bit more about this .

        the next question we have is :

why should i refinance my car ?

 and this is very simple it just has to do with two basic concepts which is the fact that you can get a lower rate you can lower your interest so you're not going to pay as much to the bank for the loan and then also a lot of the time you're going to end up with a lower payment generally if you get a lower rate as well because a lot of the time when you have a car loan you just generally don't think about the rate that you currently have on it but right now car loan interest rates are generally about two to three percent with optimal credit so keep that in mind if you have a six percent rate and your credit's pretty good then you really could probably qualify for about a 2.5 to a 3 interest rate and save a lot of money on interest and that's also going to make your payment go down as well .

so let's say that you went out and got a car last month and you financed 20 000 and then you got an interest rate of 6 percent for 60 months ..

 what this means is that you're going to have a payment of 387 bucks a month and in total you're going to pay 3 200 in interest over the entire term of the loan which is a lot of money that you're just wasting and you're giving the bank just so you can have that car now.

 but let's say that you really could get a better rate than what you currently have at six percent so tomorrow you go into your local credit union you finance the 20 000 you end up with a three percent rate and then you keep the 60 month term well now your payment's only going to be 360 dollars a month but now the interest in total that you pay is only going to be about 1500 bucks so you're going to save a lot in interest this is double,  in this case just by refinancing and you're also going to get that lower payment ,

now obviously if you have a really big car loan like for instance if you're driving around in a brand new escalade and you finance ninety thousand dollars then obviously going from a six percent rate to a three percent rate is going to save a ton of money so just keep that in mind based on the amount on the loan this is going to make those numbers change quite a bit and obviously if you have a six percent rate and you only go down to a five percent rate but you only finance let's say 6000 dollars that's really not going to save you that much money but it's still probably worth the hassle because any money that you save on interest is just more money that you can use throughout your life you could pay more towards your car you could just buy some more groceries anything is better than just giving it away to the bank

 so keep that in mind and i just want to be honest here but if you are refinancing your car just to get a lower payment please make sure that you're getting a better rate because at the end of the day if you went in and you had a six percent interest rate and then you extended your loan for another two years 

so for instance if you went from a three-year loan to a five-year loan and you kept the exact same interest rate or it even went up you are not going to save any money you are going to have a lower payment which sounds like you're saving money but you're not,

 the interest rate has to go down in order for this to actually make sense .

so what i would recommend you do is to focus on getting a better rate and then keep the same term that you're already on so for instance if you have 34 months left on your car and you go and refinance it make sure that you're getting a better rate and then because they don't have a 34-month loan go with the 36-month loan because that's close enough and in this case you are going to have a lower payment and you're going to save on interest and this is exactly what you want to be doing and even if the interest rate for a 36-month loan is exactly the same on a 60-month loan just keep in mind that you are going to be paying more interest on the 60-month loan because remember you're paying interest on what you owe so if you're spreading that out over five years versus three you're always going to pay more interest because that loan has been extended for two years,

 so just keep that in mind as well cars appreciate way too fast on their own so you always want to be paying off these loans as soon as you can don't be doing loans for higher than 60 months because a lot of the time the car is going to depreciate faster than you can actually pay it off and you're generally going to end up upside down in the car alone unless you had a ton down on the car when you originally bought it .

so just remember that cars depreciate way too fast and you want to be paying those off as soon as you can and then like i said earlier if you feel like you can get a better rate through your local credit union or that you know that your credit score has gone up since the last time you checked it you're probably going to end up getting a better rate and a lower payment and what's the worst in trying you could go into the bank they could deny you you can just move on with your life but you can always keep trying to refinance your car in the future as long as your credit score has gone up and if interest rates have gone lower now