In these troubled economic times, it can be difficult to keep up with a monthly car payment that was budgeted for in a different era. With so many people having their hours cut at work, or being let go altogether, it can become nearly impossible.
Which is why auto refinancing is a viable option for some. Although many people avoid the idea of refinancing their auto loan because they are afraid of a labor-intensive process of filling out paperwork for hours, similar to the process of refinancing your home loan. The automobile loan refi industry, however, is markedly less complicated, and you can usually get an answer on your refinance application with just 10 minutes of work on your part.
If you need to save money on your monthly payment, or just think you can get a better rate on your car loan, there are a number of sites you can try, including Capital One Auto Finance and Bankrate.com. The average rate on a 36 month auto loan in 2011 was 5.47%, and 48 month car loans was at 4.89%. Anyone who got a loan for their car before 2009 can probably save a bundle of cash by simply refinancing their auto loan to a lower interest rate.
Although stretching out the term of your loan can save you money on the monthly payment, keep in mind it will increase the amount of money you pay overall. That’s because the longer it takes you to pay back what you borrowed, the more you pay in interest rates.