Home values and the cost of rent is soaring across many parts of the country. We’re experiencing higher inflation rates than we’ve seen in decades. Supply chain issues have increased the cost of many consumer items, including new and used vehicles. Due to all of these factors, the cost of living is reaching all-time highs. It should come as no surprise that many families are struggling financially.
If you could use an infusion of cash into your budget, auto refinance may be an excellent option. Refinancing your car loan can be an effective way to save money and get out from under the financial strain you’re currently experiencing. Below are 4 ways you can save money with auto refinance.
If you feel like you didn’t receive a great interest rate on your initial car loan, you’re not alone. Many individuals end up saddled with a high interest rate when they finance a vehicle. There are several reasons why this may happen:
Regardless of the reason for your high interest rate, refinancing your auto loan can help you achieve a significantly lower interest rate. If your credit score has improved since you purchased your vehicle (which is common if you make your monthly auto payments on time), you may be able to get approved for a lower interest rate.
A lower interest rate will mean that you’re paying less money over the life of your car loan. In many instances, it will also give you a lower monthly payment. This unlocks both long- and short-term savings benefits.
A lower interest rate will result in a lower monthly payment if your new loan runs for the same term as the old one. You can also lower your monthly payment by refinancing for a longer term. In either of these scenarios, your lower payment will make it easier to manage your monthly budget.
Keep in mind that if you refinance for a longer term, you will actually end up paying more over the lifetime of your loan since you’ll be accruing interest over a longer period of time. However, this may still be a smart approach if the additional upfront cash in your monthly budget will help you to pay your bills more easily.
In many instances, you’ll be able to skip one to two monthly payments when you refinance. This provides an instant infusion of cash into your monthly budget. Whether you pay down other debts with this money to reduce future monthly expenses or simply put this money into your savings account, it can provide important financial relief.
In some instances, you may be able to roll higher interest debts into your auto loan when you refinance. If your vehicle is worth more than the amount you owe on your existing loan, you can refinance for the full amount of your vehicle. You can then take this additional money and pay down the balance of a credit card or other loan that has a higher interest rate than your auto refinance. Over time, this can save you a significant amount of money.
At iLending, we’re committed to making auto refinance easy and hassle free. We’ve created a unique You First Approach™ to ensure a great experience for you every step of the way. As part of our exclusive approach, you’ll be paired with a personal loan consultant who will:
On average, individuals save $145 per month when they refinance their auto loan with iLending. This can provide the breathing room you need in your monthly budget and free you up from the financial burdens associated with your existing car loan.
Apply now to get the auto refinance process started.