The principle behind auto loan refinancing is simple: You take on a new loan to pay off the balance on your
existing auto loan. If you’re struggling with a high interest rate or an unaffordable monthly payment, refinancing
could be the key to finding better, more favorable terms.
…If you want a better interest rate.
Consider refinancing if interest rates have dropped or if your credit health has improved.
…If you want lower monthly payments.
Are you having a difficult time covering your monthly payment? Refinancing for a longer term can bring down
your monthly costs. Keep in mind that while lower monthly payments may help you in the short term, a longerterm
loan could put you at more financial risk. You may be stuck paying off your loan after your car’s value has
depreciated. If your immediate goal is to reduce your monthly expenses, an auto loan refinance could still be a
good choice. Consider refinancing now but increasing your monthly payment once your financial situation has
…If you won’t be penalized for repaying your existing loan.
Refinancing your auto loan means paying off your existing loan early. This could be a problem if your existing loan
contract includes a prepayment penalty clause.
…When your credit health has improved. Better scores indicate to lenders that you’re more likely to pay off
your loan, so you may get a lower rate.
…When you’re not underwater on your loan. Be sure your car is worth more than the remaining balance.
Refinancing your auto loan can help you access new payment options that better fit your needs. Whether your
credit has improved, interest rates have gone down or you’ve found a lender who can offer you better terms, it
might be the time to refinance.
Flip-Flop your loans to WKFCU. You Will:
(*Annual Percentage Rate. Some Restrictions Apply. Offer ends Jun 30, 2019. Fun in the Sun Gift available while
supplies last. Does not apply to existing WKFCU loans.)
Partially reprinted from Credit Karma, “When Should I Refinance My Auto Loan?
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*APR = Annual Percentage Rate
*APY = Annual Percentage Yield
Rates are subject to change without notice
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