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Should I Refinance A Car Loan In Oakville?

Should I Refinance A Car Loan In Oakville?

If you’re having trouble paying your auto loan in Oakville or your circumstances have changed, you may be tempted to refinance a car loan. But what is auto loan refinancing, what does it achieve and is it a good idea?


Our Oakville auto loan team finds out!


What is auto loan refinancing?


Auto loan refinancing is a formal term for getting a new loan. That could be a lower, larger, longer or cheaper loan. It just means swapping your existing loan for another.


It doesn’t usually involve a new car, just switching the type of loan you use to pay for it.


If I Refinance A Car Loan, What Does It Achieve?


What refinancing will achieve depends on your circumstances. It’s a useful tool for changing up your situation, usually for a better one.


Auto loan refinancing works in several situations, including:


You want to reduce your monthly payments – If you have paid off a significant portion of your loan, you can refinance to a smaller loan with lower monthly repayments. This can be useful if the monthly amount is causing difficulty.


You want to free up some cash – You can borrow more against the value of the car to free up cash for home improvements, emergencies or something else. Much will depend on the car’s value but otherwise, this is an easy method to get cash.


You want to pay the loan off early – If you have more disposable income each month, you can save it up and settle the loan early or refinance to a shorter term with higher monthly payments.


Your credit score has improved – If you originally had a bad credit car loan and have since improved your score to qualify for a standard loan, refinancing can make sense. You will likely get a much lower interest rate which could save big money over the term of the loan.


Lower interest rates – Auto loans have a set interest rate determined at the time of application. If prime rates have dived and you could qualify for a much lower rate, it may be worth refinancing to take advantage of that.


Is auto loan refinancing a good idea?


It can be a good idea depending on your situation. If you’re having trouble making payments and think you might default, then it is very likely a good idea.


If you could save a lot of money with a lower interest rate and the amount of time you have left makes switching worth it, that’s also usually a good idea.


We are hedging our bets here with ‘likely’ or ‘usually’. That’s because it’s hard to make an accurate determination without knowing your particular situation. For that we would need to know a little more about you.


We’re game for that if you are. We may even be able to find you a cheaper Oakville auto loan at the end of it!


We will use all our skill and experience to deliver the lowest possible Oakville car loan rates, guaranteed. Contact Car Nation Canada Direct to learn how we can help.


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Categories: Auto Loan

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