While Drivers Lane isn’t a lender, we do have resources and tips for consumers looking to go through the auto refinancing process. We won’t directly refinance your car for you, but we can help you understand how to get started refinancing your car loan.
How to Refinance Your Auto Loan
“When should I refinance my auto loan?” The answer ultimately depends on your current financial situation and the terms of your car loan, but if you’re looking to refinance for a better deal, here are some steps you need to take to prepare:
- Credit scores – Pull your credit reports and credit score to check for errors and be informed on your credit situation. Lenders typically base what you qualify for on your FICO score, and if your score has improved since you took out your original loan, you may be ready to refinance.
- Existing loan – Have the information on your current loan handy, including the lender and loan number. You’ll need to request a 10-day payoff amount from your current lender.
- Vehicle information – Put together any information you have on your current vehicle. Make sure you have the vehicle identification number (VIN), make, model, year, and mileage information ready. If you don’t live in a title holding state, you’ll also need to bring your vehicle title.
- Compare refinancing rates – To avoid multiple hard inquiries on your credit report, do your rate shopping within the given time frame (anywhere from 14 to 45 days). Check with your current lender, bank, credit union, and other online lenders to see what rate and terms they can offer you.
- Extra documentation – You might need proof of income. A recent computer-generated pay stub will work for the lender's income requirement.
Also, you should know that lenders won’t refinance if your current loan is above the vehicle’s actual cash value (ACV). Refinancing can be a great way to save money by getting a better interest rate on your auto loan. It may take some time before you’re able to refinance a car loan, but it helps to make sure you're prepared and confident when you’re ready.
If you’re ready to refinance, we’re teamed up with SmallerCarPayments.com to help borrowers refinance their current auto loans.
If you're here because you need a car loan, Drivers Lane is here to help. We have a network of special finance car dealers who have the lending resources available to assist people with unique credit situations. We can help you get the process started by connecting you with a dealer in your area. Take the first step today and fill out our no-obligation online auto loan request form.