6 Reasons You Might Want to Refinance Your Vehicle Loan

Your loan doesn't have to stay where it started.

When you bought your auto or recreational vehicle, you probably weren't thinking about where your loan would be a few years down the road. You found the set of wheels you wanted, worked with the dealership or financial institution to arrange your financing, signed the paperwork - and drove away.

But here's something you may not realize:

Just because your loan started with another financial institution or thorugh a dealership doesn't mean it has to stay there.

Circumstances can change

• Your financial situation
• Current rates
• Your priorities

and when they do, your loan may not fit quite as well as it once did.  Here's the good news - you have the option to refinance your loan and bring it to your credit union. 

Refinancing your auto loan could give you an opportunity to lower your payment, pay off your loan sooner, or make changes to your loan that better fit your current situation.

Here are six reasons it might be worth taking another look at your auto loan.

1. You could lower your rate or payment

One of the most common reasons to refinance is to see if you can get a lower interest rate or monthly payment. If rates have changed since you originally financed your vehicle—or if your financial situation has improved—you may find that refinancing makes sense. A lower rate could save you money over the life of the loan, while a lower payment could give you a little more room in your monthly budget.

And if  your current loan is with another financial institution, there's no reason you can't bring it to 1st CCU and see what we can offer.

2. You want to pay off your loan faster

Maybe your financial situation looks different than it did when you first bought your car, truck, RV, UTV, boat, or motorcycle. If you're in a position to pay a little more each month, refinancing into a shorter loan term could help you pay off your vehicle sooner and potentially reduce the total amount of interest you pay over the life of the loan.

Instead of simply continuing the loan you started years ago, you can choose financing that better fits where you are today. It's a great option for borrowers who want to put their loan behind them a little faster.

3. You need access to cash for an important expense

If your vehicle is worth more than you owe, a cash-out auto refinance may allow you to borrow against some of that available equity while refinancing your existing loan.

Whether you're facing an unexpected expense or have another important need, a cash-out refinance could give you access to funds while keeping your vehicle financing in place.

4. Your auto lease is expiring

If your lease is coming to an end and you've decided you want to keep the vehilcle, you may be able to finance the remaining balance rather than return it. 

It's another opportunity to choose where you want your financing to be - not simply continue with the arrangement you started with.

5. Your credit has improved

Your credit today may look very different from your credit when you first financed your vehicle. 

If you've built a stronger credit history, paid down debt or improved your overall financial picture, it may be worth seeing if you qualify for better financing terms.

Your original auto loan was based on your circumstances at the time. It doesn't have to define your financing today.

6. You want to remove a co-signer

Maybe a parent, family member or friend helped you qualify for your original auto loan. If your financial situation has changed, refinancing may give you the opportunity to apply for a new loan in your name alone.

That could give you greater financial independence while allowing your co-signer to step away from responsibility for the loan.

Ready to Bring Your Loan to 1st CCU?

You don't have to wait until you're ready to buy another vehicle to reconsider your financing. And you don't have to keep making payments to the financial institution that handled your original loan simply because that's where the loan began.

You have options.

At 1st Community Credit Union, bringing your auto or recreational vehicle loan to us is easy. You can apply online from wherever you are, and our local lenders  are here to answer your questions and help you through the process.

It's worth taking a second look. Keep the vehicle you love and bring the loan to a financial institution that wants to work with you.

Ready to make a move? Apply today

*Certain restrictions and eligibility requirements may apply. All loans are subject to membership and credit eligibility. Contact 1st Community Credit Union for details.