Should You Refinance Your Car Loan?

List: Posted: 03/05/12

Unfortunately, having money troubles from time to time is a part of life.  There are numerous ways that you can get out of debt and free up money in your life, and one of those ways is to refinance your car loan

First, when done wisely, refinancing your car loan can be a good decision.  It can help you lower your monthly payments by a considerable amount each month.  This extra money can be put towards anything that you might need, from paying down back bills to creating a nest egg of savings.

However, refinancing a car loan does have some negative effects.  It will reflect on your credit report and will increase your debt to income ratio.  It will also mean you pay more for the car in the long run.

Refinancing a car loan lowers your monthly payments, but increases the amount of interest that you will owe on the loan.  In some instances, this can tack on thousands of extra dollars to your loan, which might not be the best thing to do in the long run.  In addition, it keeps you in debt for a longer period of time.  Generally, car loans are extended by several years during the refinancing process, forcing you to continue paying on that car long after it would have been paid off had you not refinanced.

Refinancing can be a good decision, but not in all situations.  Think very carefully before you decide that this route is right for you, and don't rush into anything because money is tight.

Credit Unions

    Navy Federal Credit Union is the world’s largest credit union and proudly serves members of the military, DoD, and their families providing solutions in banking and other financial needs worldwide. Learn more about our services such as auto loans, mortgage lending, and top rated credit cards. Join today!

    • 44315 Ice Rink Plz
    • Ashburn, VA 20147
    • (888) 842-6328

      Navy Federal Credit Union is the world’s largest credit union and proudly serves members of the military, DoD, and their families providing solutions in banking and other financial needs worldwide. Learn more about our services such as auto loans, mortgage lending, and top rated credit cards. Join today!

      • 46300 Potomac Run Plz Ste 180 Ste 180
      • Sterling, VA 20164
      • (888) 842-6328

        Navy Federal Credit Union is the world’s largest credit union and proudly serves members of the military, DoD, and their families providing solutions in banking and other financial needs worldwide. Learn more about our services such as auto loans, mortgage lending, and top rated credit cards. Join today!

        • 1821 Fountain Dr
        • Reston, VA 20190
        • (888) 842-6328
        • 21830 Uunet Dr
        • Ashburn, VA 20147
        • (703) 723-1708

        The material in this article is for informational purposes only. The views expressed in this article are those of the author and do not necessarily reflect the views or opinions of Local.com. See Additional Information

        More about local.com Features

        Socialize With Us
        Business Top Searches
        Recently Added Coupons

        Copyright 2017 Local.com Ltd - US Patent 7,231,405 - Privacy Policy - Terms of Service
        Advertise with Us - Claim Your Business Listing - Contact Us - FAQ - Site Map - Some data provided by Acxiom.