When experiencing a financial hardship and bankruptcy is not an option, then a lot of people look to refinance one or both of their automobiles to try to cut monthly costs. Our present economy can create a much larger hurdle to lower the payment, reduce the negative equity and shorten the term of the car detailers loan. That is why you need to know the ins and outs of the refinance process. Once you learn the information presented in this article, then you will know whether or not refinancing you car is the right thing for you.
Before we discuss some of the benefits of refinancing you car note, let’s talk about how and where we apply for a refinance car loan.
The first thing that the lender may require is you to have equity in the collateral you are putting up to be refinanced. The two main factors used to determine your equity or negative equity, is the amount you presently owe, the mileage on the car and the year it was manufactured. Depending on your credit score and if you have any negative equity, the lender may require a down payment.
The next thing that you need to take into consideration is the miles on the odometer. The miles, in most cases, will usually dictate the length of the loan and if it is to high, a lot of the lenders will not do a refinance on that particular car at all. provided your credit score has not dropped then you can do what most people used to do and that is, go to the nearest dealership and trade it in. The biggest problem with that is you are just taking your negative equity and rolling it into the new loan, which in today’s economy, is just not a good idea.
So now we know the benefits of refinancing our car but what if we have to many miles, or owe more than the car is worth or maybe our credit score has dropped due to a financial hardship. What has to be done is to find a company that can refinance your car no matter how many miles, no matter how much negative equity you owe and no matter how low your credit score is.
In conclusion, You need to do your homework to find out your credit score, book value of your car and the amount that you owe. Once armed with this information, then you will be one step away from getting your car refinanced and your new payment in line with your budget.