As interest rates drop across the country, drivers who feel they are paying too much for their car loan should look at their options when it comes to financing.
According to the Washington Post, car loan rates have “edged down” in recent months, making it a great time to apply online for a car loan or refinance an existing loan.
Borrowers, however, should be mindful of fees. Various lenders institute fees for refinancing. A driver should do the math to make sure that their refinancing is the right move. Knocking an interest rate down by a few percentage points may not seem like a lot in the face of a $200 processing fee, but that shift can save a driver thousands over the life of a car loan.
While drivers with bad credit are often pre-approved for a car loan, they may not qualify for refinancing right away. However, knowing that refinancing is an option is beneficial. Even if a driver is not completely satisfied with the initial rate, they’ll improve their credit substantially by making payments on the loan. Once they’ve built up their credit, they can refinance to a better rate.