How to Refinance a Car Loan

woman signing document at a car dealership

Car drivers looking to lower their monthly car payments and save on interest should consider refinancing. At Mercedes-Benz of Bloomfield Hills, we have all of the details about what to know when refinancing your car. Learn all of that and more with the financial experts at Mercedes-Benz of Bloomfield Hills near West Bloomfield.

How Do You Refinance a Car Loan?

Drivers refinance so they can lower their interest rates. To refinance your auto loan, you need to know how much you are paying in interest and your monthly payment. Take a look at your documents or reach out to your lender to confirm the information. Then, follow the simple steps below:

  • Check Your Credit Score: Paying all of your bills on time? There is a good chance that your credit score has improved and you could benefit from refinancing.
  • Start Applying: Apply to multiple automotive refinance companies to ensure you’re getting the best rate possible. Be sure to submit all of your applications within 14 days to minimize the negative impact on your credit score.
  • Evaluate Offers: Do not rush running the numbers, and make sure that any new offers coming back get you the lower monthly payment you want. Use our online monthly payment calculator to compare your offers.
  • Decide Loan Term: Decide if a longer or shorter-term loan fits your situation. A shorter-term loan requires larger monthly payments, but you will pay less interest in total. With a longer-term loan, your monthly payments are smaller, but you pay more in interest in the end.

The best way to refinance an auto loan varies based on your circumstances, so make sure you get the offer or terms that best fits your financial situation.

What to Know When Refinancing Your Car

There are several things to remember when deciding if refinancing your vehicle is right for you:

  • Fees: Check your original car loan to make sure there aren’t any fees for paying it off early. If there are, refinancing may not be cost-effective.
  • Underwater Finances: If you owe much more than what your vehicle is currently worth, it can be harder to get approved for refinancing.
  • Older Vehicles: Many lenders won’t refinance an older car that has already experienced major depreciation.

Do you find yourself in one of these situations? Don’t hesitate to contact the finance center Southfield. Our financial experts can give you advice, car buying tips, and guide you in the right direction.

Learn About Your Financing Options Near Birmingham!

Our finance experts at Mercedes-Benz of Bloomfield Hills are waiting to share what you need to know when refinancing your car. If you have additional questions about refinancing a car loan or would like to know if gap insurance is worth it, don’t hesitate to give us a call! We’re proud to serve as your chosen Bloomfield Hills Mercedes-Benz dealership for all of your automotive needs.

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36600 Woodward Avenue • Bloomfield Hills, MI 48304

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Mercedes-Benz of Bloomfield Hills 42.557334, -83.22114.