Warm days are right around the corner and many of us are ready to take our favorite cars, boats, or RVs out for a much-needed adventure. But if you’re unhappy with the price you’re paying on a monthly vehicle loan to fund your hard-earned wheels, it can take the fun out of those future plans.
Whatever the reason for your unmanageable payments may be, you’ve probably thought to yourself, “Should I refinance my vehicle?” And we’ve got the answers to your question! Check out a few valid scenarios as to why you may want to consider refinancing your auto or vehicle loan.
Change in Income
No matter when you last took out an auto or RV loan, it’s likely that you agreed on the interest rates and terms based on your financial standing at the time.
For lower monthly payments, you probably opted for a longer-term loan. Or If you thought it would be possible to pay off your vehicle as soon as possible, your current payments are probably higher due to a short-term loan.
Despite the circumstances, if you find your income fluctuating for whatever reason, what you can contribute to a monthly payment will change. Doesn’t that mean you should shop around for a loan that aligns with your budget, too? Refinancing a vehicle loan with Discovery FCU means you can access new rates and terms that better fit your current financial needs.
Stronger Credit Health
Maybe your credit score has improved since taking out your current auto loan and you’ve made every payment on time. So why do monthly payments still feel so high? No one expects you to have a squeaky clean credit history in order to take out a loan, but you should be rewarded for taking the steps to secure financial stability and finally raise that credit score.
Unfortunately, presenting a newly off-the-charts FICO or VantageScore to your lender won’t do much to improve your current interest rate. But with an auto or recreational vehicle loan refinance, you can think of it as a fresh start!
Competing Loan Rates
Wondering, “can I refinance my vehicle?” Here’s the short answer. You absolutely don’t have to feel stuck with the monthly payments you owe on a current vehicle loan due to existing interest rates or terms. While every financial institution’s interest rates on vehicle loans differ, if you’re unnecessarily breaking the bank as a result of unnecessarily high rates, it’s definitely time to make the switch.
Maybe interest rates aren’t the problem as much as the life of your current loan. If circumstances have changed since you last took out a vehicle loan for the short term, extending the terms of your current loan can help you save immediately and give you the peace of mind that your monthly payments will be met every month.