Refinancing Car Loans with Bad Credit
Refinancing car loans with bad credit can be a great solution to some of your financial problems. It will give you a chance to reduce your monthly payments and the interest rate on your loan. Depending on the auto loan refinancing option you choose, you might even get some cash out of the deal. At Complete Auto Loans we can help you find an auto refinance plan that will work best for your particular case.
In this article, we offer a detailed overview about refinancing car loans. Discover more about no credit check car loans here. We will explain its advantages and disadvantages. You’ll be able to make the right decision when refinancing a car loan with bad credit.
Refinancing Car Loans in Four Steps
- Refinancing Car Loans in Four Steps
- Quick 6 Top Benefits to Refinancing Your Car
- The Full Truth: Bad & Good of Auto Refinacing
- We Help Protect Your Credit Score
- When to Apply for a Car Loan Refinance
- Refinancing Car Loans – The Myths
- Effective Car Loan Refinance Tips
- Refinancing Car Loans- How to Get the Best Deal
- Lower Interest Rates When Refinancing Car Loans
- Requirements When Refinancing Car Loans
- Refinancing Car Loans FAQ
Here’s 4 keys to getting car refinanced with bad credit:
- Research the pros and cons of refinancing with bad credit.
- Find out your current credit score and calculate your payments.
- Search online for the best the best refinance offers available.
- Choose the best auto refinancing option online and apply.
At Complete Auto Loans, we provide you with an opportunity to find the best auto loan refinancing for bad credit. We also offer the opportunity to apply for the loan online. With Complete Auto Loans there aren’t any application fees or obligations. Our goal is to help people with bad credit find financing that will improve their situation. We’ll do our best to ensure you get the best rates from lenders that are willing to work with bad credit borrowers.
You can contact us anytime and we’ll answer all your questions about auto loans. Our website also offers a wide range of articles and guides that you can use to find the best bad credit lender for you.
Quick 6 Top Benefits to Refinancing Your Car
1. Debt Consolidation
One of the benefits of refinancing car loans is that you can use it to merge your current debts. For example, if you have a credit card or personal loan you can merge and refinance them. This will allow you to reduce your regular payments. With wise budget planning, this can help improve your financial situation faster.
2. Getting Money in Case of an Emergency
If you need to pay for some emergency repairs, you can use auto loan refinancing to free up some money and get cash. This will help you avoid taking a personal loan with high rates. Now, you can get your car loan refinanced in a matter of hours, even with a bad credit score.
3. Reduce Car Payments
Refinancing car loans gives you the chance to extend the term of the loan to lower your regular payments. You can enjoy this feature regardless of whether your credit is good or bad.
It can be difficult to stay up-to-date with payments. Refinancing can give you the opportunity to prevent defaulting on a loan. As a result, you can avoid damaging your credit further.
Note that extending the loan will increase the amount of interest you pay. However, it allows you to increase your monthly cash flow. Analyze your situation and seek professional advice to make the best decision for your particular case.
4. Reduce Interest Rate on a Car Loan
The vast majority of bad credit auto loans have high interest rates. If you have no other choice but to take out such a loan, you can improve your situation with auto loan refinancing. You can refinance if you’ve had the loan for a year and have made at least one payment.
Doing this will have improved your credit score, so getting a new loan with better terms will be much easier. Now we will help you find a lender who specializes in refinancing car loans. We’ll get you a deal with a much lower interest rate.
Refinancing car loans early can save money in interest rates. It will also make it easier to make monthly payments as these will be lower. Providing a down payment will allow you to get much better terms.
5. Get Cash from Refinancing Car Loans and Skip a Payment
Refinancing car loans can enable you to draw the capital on your car if it has equity in it. Due to this specific benefit, it might be wise to refinance even if your current loan is satisfactory. With the money you save you can pay off some other debts. Refinancing car loans can also allow you to skip a payment as your first payment will only be due within 60 days.
6. Improve Your Credit Score
One of the most important benefits of car loan refinancing is that it allows you to fix your credit score. By reducing your regular payments, you cut the risk of defaulting. Lenders report to credit bureaus. This means you can be sure that your good behavior is being recognized. Also, your rating will improve with every payment you make.
The Full Truth: Bad & Good of Auto Refinacing
The Advantages of Refinancing Car Loans:
- You can reduce your monthly car loan payments.
- This is the biggest advantage of refinancing car loans and it will allow you to save money. To reduce your payments you can:
- Make a down payment on the new car loan
- Extend the term of the loan
- Negotiate a lower interest rate
- You can turn equity into cash.
- Clever loan structuring will allow you to free up some cash. You can do this by using the equity in the car to secure a new loan with a car lender who specialises in refinancing.
- You get a chance to merge debts.
- Depending on your current situation you could merge debts and getting a refinance with better terms.
- You can skip a payment.
- In most cases, car loan refinancing will have your first payment scheduled for the month following the refinance.
- Changing lenders allows you to refinance anytime.
- It can be difficult to negotiate refinancing car loans with your current bank. But, finding a new lender is easy with us.
- You can shop for the best terms.
- Often, people have limited choices of car loans. Because of this you may not get an opportunity to look for the best deal. When refinancing, there is no rush, so you can shop around and compare offers.
- Refinancing car loans is easy.
- With the help of us you can refinance your car loan fast, even with bad credit.
The Disadvantages of Refinancing Car Loans:
- Multiple loan applications will lower your credit score.
- Every time you send out a loan application the lender files for a credit check. If several inquiries come in a short time your credit score will get lower. Even if your score gets lowered by about 5 points due to lender inquiries it could be worth it. You may save by refinancing your car loan.
- Your car will become a ‘used’ one when you apply for refinancing.
- If you used an auto loan to buy a new car, you’ll have to refinance it as a used one. Be sure to consider the resale value of the vehicle when you decide whether to apply for auto loan refinancing.
- Depending on the terms of the new loan, you may pay more in the long term.
- Reduced payments may not be as beneficial if refinancing extends your loan term. In this case, you’ll pay more money in interest in the long run.
- Finding an auto loan refinance for an old or high mileage vehicle can be difficult.
- The majority of the lenders won’t finance a car like this. We work with financial institutions that are willing to overlook many common issues. We will be able to help you get a loan even if your car is over 5 years old.
- You might lose money due to early payoff fees on your current loan.
- It’s imperative to check the terms of your auto loan before you apply for car refinancing. Early payoff fees can negate all the benefits of this solution.
We Help Protect Your Credit Score
Working with us will help you avoid credit penalties that come from frequent lender inquiries. Our service will review your application with our chosen lenders to pick the best one for you.
- Lenders will compete for your loan and the one that offers the best terms for you will perform a credit check. This won’t lower your score, unlike when more than one inquiry is open at one time.
- We can help you with refinancing car loans regardless of your credit score. We have lenders who only work with bad credit borrowers. Our lenders offer good terms so even if your current score is poor, you could get a loan with low rates.
When to Apply for a Car Loan Refinance
Refinancing car loans is great to reduce your monthly payments and interest rates. You can also use auto loan refinancing to make the most of the economy. It’s important to note that you need to apply for auto loan refinancing at the right time to get the most benefits.
How Soon can you Refinance an Auto Loan After a Conventional Loan
If you have a conventional car loan, refinancing your car is possible whenever you want. Here’s a few important factors you need to keep in mind:
- Credit check inquiries from refinancing lenders can reduce your credit score. Have a good think about whether you can risk this in your current situation. Perhaps, you should wait until your credit rating improves a bit.
- Auto refinancing rates can be higher than you expect because you will get a loan for a used vehicle. The car value drops as you drive it, which is why it’s important to pay off auto loans fast. This will give you some equity in the vehicle when you finish paying for it. Extending your loan through refinancing may be a poor choice in the long run.
- Consider loan fees as you will have to pay them again when you refinance. If you apply for auto loan refinancing right after you get a subprime car loan, you will lose money through double fees.
When Is the Best Time for Refinancing Car Loans?
The answer to this question will depend on your current loan terms. It will also depend on the refinancing options you can find. You should refinance if you find a lender that offers rates at least 2 points lower than what you have now. Here’s a few points to remember:
- For bad credit auto loans, you can expect to pay about 18% interest rate. Our loan calculator will help you get a better idea of how much you can save through refinancing car loans.
- Always get a ‘fresh’ copy of your credit report before refinancing car loans. You will need to understand what kind of deal you can get from lenders. The better your score is, the lower the rates you will get.
- If you work with us we will help you find the best offers. Our lenders work with high-risk borrowers and can disregard your credit score. On top of this, they offer reasonable rates if you have a steady income.
- It’s best to make several payments on your current loan before seeking to refinance. However, if you have an unfavorable subprime loan and want to change it right away, we might be able to help.
- Note that making higher monthly payments won’t improve your credit score faster. It’s regularity that matters, not the amount of money. As long as you make the payments on time, your credit rating will improve.
Can I Pay Off an Auto Loan Sooner?
- If your car loan allows for this and you can afford to make bigger payments, you can pay off your debt before term.
- However, you may consider a different solution. Save up the extra money you would have spent on early payments and make a 10% down payment on an auto loan. Then, refinance your current loan with this down payment and get exceptional terms. This will have a better effect on your credit rating as well as reduce your monthly payments.
- We don’t care whether your car has equity in it or if your credit rating is low. When you send your application to us, you can be sure that it will get a fair review from a variety of lenders. Once this done, we’ll pick the one best suited to your unique situation.
- Note that the lender may need more information, in which case they will contact you directly. Once they have all the necessary data, they will perform a single credit check. They will then determine the final terms to offer you.
- Once you get the lender’s approval, you can make your final decision. If you choose to proceed, the refinance lender will take care of all the transfer issues. The lender will also sort out everything regarding the communications with your bank. Usually, you’ll have to start making payments to your new lender within 45-60 days.
Refinancing Car Loans – The Myths
Many people miss out on the benefits offered when refinancing car loans. There is a lot of controversial information about this kind of financing.
You can still get auto refinancing even if the following is true:
- Having an open or previous bankruptcy.
- Your income being difficult to prove (e.g. if you are self-employed).
- One of your cars being repossessed in the past.
- Needing to refinance an upside down loan.
- Receiving disability payments.
- Not having a credit history (e.g. students).
- Needing to get out of debt as soon as possible.
- Having a poor credit score.
- Having a low level of income.
Requirements when Refinancing Car Loans
Our lenders can overlook many factors in an auto loan application. However, there are some requirements that applicants must meet to gain approval:
- You need to have proof of regular income sufficient to pay off your new loan.
- You should either have the Vehicle Title or Limited Power of Attorney to change the current one.
When Refinancing Car Loans Is the Best Choice
There are many reasons that make applying for auto loan refinancing a smart choice. The most common of them are:
- Wanting to buy a car you’ve been leasing
- Having a current income that doesn’t allow you to make regular payments at the rate you have now
- Experiencing sudden financial problems, e.g. an accident or loss of a job
- Wanting to use the recent drop in interest rates to improve your credit score
- Needing some cash fast while there is equity in your car
Why Refinancing Car Loans with us is Best
Often, people don’t shop around for the best loan when they first buy a vehicle. This can leave you stuck with high interest rates and generally unfavorable terms. We can offer an effective solution to your problems.
Refinancing car loans with our services is simple and convenient. You file an application online and we do the ‘shopping around’ for you. Our lenders offer loans to high risk borrowers. This means people with a poor credit score and/or low income can still get the car they need.
We are looking for the best deal based on the information you provide in the application. Refinancing is a great choice for people with subprime car loans as these usually have high interest rates. Even a small reduction in the percentage of such a loan can save you thousands of dollars over time.
When Can I Get Equity on the Car in Cash?
If you choose to refinance to get a cash payment from your car equity your loan must be smaller than the value of your car. For example, if you car is worth $8,000 and your loan is $5,000, the equity is $3,000. The difference is the amount you own. If you refinance this loan, the new lender will pay off your current loan. The lender will then provide you with a new one to cover the rest of the vehicle’s value. The difference is the amount you could get in cash.
Selling Vs. Refinancing Car Loans
Many people choose to sell their vehicle if they can’t keep up with the regular payments. But, this can leave you needing a new car. The truth is that getting a new loan, even for a used car, will be harder than getting your current one refinanced. A low credit score will make lenders raise their interest rates. This could mean your new loan will have unfavorable terms.
We can help you find bad credit auto refinancing providers. Our lenders won’t abuse your situation and will offer reasonable rates.
How Refinancing Car Loans can Improve Your Credit Score
Refinancing car loans lowers your regular payments. This means that the risk of defaulting decreases. If you realize you can’t afford to make the payments, refinancing might be the best option. Making regular payments, big or small, will improve your credit score.
Effective Car Loan Refinance Tips
What Makes a Great Car Loan Refinance Deal
There are dozens of auto loan refinancing options available. Some of them can put you in a worse position that you are now. To be sure you are making the right choice you need to consider the following:
- Length of the loan. By cutting down monthly payments by exchanging a 5 year loan for a 10 year loan you will end up paying more interest. In some cases, this may be necessary, but you should look for more favorable alternatives. We will help you make the right decisions.
- Overall terms of the loan. If the deal sounds too good to be true, it could be. You need to be careful as it might have some hidden terms that make it highly unfavorable. Study the paperwork and read the fine print before signing anything. If you can, have your attorney look it over as well.
A great car loan refinance offer should have lower interest rates and extend your loan term by no more than 2 years.
Below are the most common auto loan refinancing terms for bad credit used in the industry:
Loan Amount Terms Available:
- $20,000+ Up to 84 Months
- $15,000+ Up to 72 Months
- $5,000+ Up to 66 Months
How the Age of the Car Affects Refinancing Car Loans
The value of your car when you refinance is lower than it was when you bought it. You need to be aware that many lenders won’t approve refinancing for vehicles older than 10 years.
The older your vehicle is, the higher the mileage is, and the higher the interest rates will become. Often, lenders increase the rates for cars over 7 years old. If your original loan was for a used vehicle, the rates will be even higher.
We work with lenders that offer car financing for bad credit and other risky borrowers. This includes those with older vehicles. With our help you will be able to refinance a vehicle that is up to 10 years old.
Benefit from Paying Your Car Refinance Loan Early
An effective way of avoiding late payments is to structure your monthly budget so that you pay about 10 days early. This way, you can afford to be ‘late’ a few days without it affecting your credit score.
Depending on your refinance loan terms, paying early might cut down the interest rates. You can use automatic payments to make this process easier. The service allows you to automatically withdraw the money on the date of your choice. As a result, you won’t miss any payments.
Refinancing Car Loans- How to Get the Best Deal
If you want to get great car refinancing fast, just follow these steps:
- Check your credit rating. You need to know where you stand to understand what kind of refinance loan you need to apply for. Of course, your chances of getting a good offer will be higher if your score is high. But, a poor credit rating is no reason to despair. We will match you with a good lender regardless of your credit rating.
- Prepare the information about your current loan. You’ll need to present it to prospective lenders so that they can decide what terms to offer you. The more detailed your report is, the better your chances of getting a good deal are!
- Don’t forget to include the current mileage of the vehicle.
- Provide information about your income.
- Lenders need to know where you stand at the moment. Self-employed people will need to provide their 1099 and/or tax returns from the last 2-3 years.
- Choose the best lender for your situation. When you apply for car refinancing through us we get our lenders to review your application and contact you directly to make you the best offer for your situation.
- Compare the offers and pick the one that is most beneficial in the long term. Don’t feel that you have to agree if the offer doesn’t sit right with you. We aim to find the best deal for each of our customers but there are no obligations involved.
- Use our refinancing car loans calculator to make the right choice. Our calculator will help you with that. It will provide you with the information you need to make an informed decision.
Your Credit History Does Not Matter to Us
Refinancing car loans with us is faster and easier than getting an original loan. Use this chance to improve your credit score and cut down monthly payments. We have a wide network of lenders that offer good terms to people in difficult situations. We track the quality of each deal and only offer you the best options.
We aim to help people who can’t get conventional loans. We give people all the options available to them when refinancing car loans. The customer service team is always around to help. The team offers advice on bad credit car loan and refinancing car loans. Our website aims to educate people and help them avoid problems with car refinancing.
Your poor credit history doesn’t matter to us. We promise to do our best to get you a fair loan with fair interest rates. We’ll help you find solutions even when you feel there aren’t any.
Lower Interest Rates When Refinancing Car Loans
Most recently, interest rates on car loans have been going down. As a result, the best time for refinancing car loans is now. Of course, every lender offers different rates. Each situation is unique and depending on yours, this could affect the deal you get.
You need to remember that even a reduction of 2% can give you significant savings over time. We focus on refinancing car loans to give the lowest rates and best terms.
Take a look at the general interest rates for bad credit car refinancing:
Loan Term APR* – As Low As Up to:
- 36 Months 3.65%
- 37 – 48 Months 3.65%
- 49 – 60 Months 3.25%
- 61 – 72 Months 3.50%
- 73 – 84 Months 3.65%
Requirements When Refinancing Car Loans
The exact requirements may differ from lender to lender. Below are the basic requirements all borrowers must meet:
- 18 years old+
- Being a citizen or current resident of the US
- Age of the refinanced vehicle must be under 5 years old and its mileage must be under 100,000 miles (with us you can get refinancing for cars under 10 years old)
Important Note: Check your current loan terms to see if there are any penalties for paying it early. In the majority of cases, there would be none or a nominal fee of $5 to $75. However, some loans are ‘precomputed’. In this case, refinancing may be impossible because it will be too expensive.
Refinancing Car Loans FAQ
Can I get auto refinancing after bankruptcy?
Yes, with the help of us you can get a fair car refinance loan even after bankruptcy. This negative mark will stay on your credit report for up to 10 years. But, it doesn’t make it impossible to get a auto loan with reasonable terms.
Note: If your bankruptcy case is still open, you must get a letter from the trustee. Whether it is chapter 7 or 13 bankruptcy, you’ll need this letter to take on a new debt for refinancing car loans.
Can I get some cash back when I refinance?
Yes, there are auto refinance lenders that offer cash back incentives. You need to understand that the amount of cash you will get will depend on the terms of the refinancing loan. It will also depend on the amount of equity in your car. You may also get charged extra fees for the service.
Can I have my car refinanced if I had a repossession in the past?
Yes, you can get approved despite previous repossessions.
How Refinancing Car Loans will affect my credit rating?
You can use car refinance to improve your score. It will reduce your monthly payments. As a result, you’ll be less likely to default on your loan.
We work with a wide variety of customers and lenders looking to work together. We match people based on their individual situations and can find the best loans with great terms. Today, refinancing car loans is as simple as filling in a quick application form online.