Feeling Stuck in Your Car Loan Payment?

family sitting in car

Is your car loan payment weighing you down? If so, then it might be time to refinance. If you’re not sure, here are some circumstances that can make refinancing your auto loan a good idea.

Your financial situation changes

If you’re currently in a situation where money is tight, consider refinancing your car loan to a longer-term loan. This will lower your monthly payment and give your budget the relief it needs until your cash flow improves. If you ever have extra money, you can always look into making a principal-only payment, which could potentially shorten the length of your car loan and help save on interest.

If your finances have improved, you can refinance to a shorter loan term. You’ll be paying more money each month, but you’ll be able to pay off the loan sooner, which means you’ll end up paying less interest. You could also switch your payment from monthly to bi-weekly payments. Making bi-weekly payments allows you to make one extra payment a year, which can help to pay off your loan off faster.

You didn’t shop around initially

Buying a new car can be exciting. When you find the car you want, it’s easy to get caught up in that excitement and choose the first loan option the dealership offers you. Unfortunately, if you didn’t shop around for a loan before you bought the car, you may have missed out on a better deal. Using the car dealer’s lender can mean getting stuck with an interest rate that’s higher than what you could get at a local credit union. It’s always smart to shop around for the best interest rate and loan term you can get. If you didn’t shop around when you first bought your car, now may be the perfect time to do a little research on your options to refinance.

Your credit score improved

If you’ve been on time with your loan payments for several months, your credit score has likely improved. If you have any type of loan with us, you can check your FICO score on the Partner Colorado Mobile Banking app to see if it’s increased since you first financed your car loan. If it has, now is the perfect time to refinance and get a lower interest rate and monthly payment.

If you’re feeling stuck in your car loan payment, refinancing might be the answer. When you refinance your auto loan from another lender to Partner Colorado, you can skip your payments for 90 days! A little extra cash in your pocket is just another benefit to make refinancing your auto loan worthwhile.