Published on November 8, 2022
4 Questions To Ask Yourself Before Refinancing Your Car Loan
Since the new interest rate will directly affect your monthly repayment, knowing exactly how much your new interest will be is important. If your previous car financing loan came with a higher interest rate, a lower rate will definitely reduce your monthly payment plan.
Your credit score will also play an important role in determining your interest rate. If your credit score has improved since the time you purchased your vehicle, it’s likely that your new interest rate will be lower. But, if your score has worsened or the value of your vehicle has significantly dropped, there is a chance you’ll receive a higher interest rate.
2.How Long Is The New Loan Tenure?
Refinancing your car loan at a lower interest rate would lower your monthly payment, but you will be paying a lot more by the end of the payment term. A longer-term, even with a lower interest rate, would directly mean paying more in interest over time.
If refinancing your loan with a lower monthly payment plan benefits your financial situation, then going ahead and it would be worth it. But you should always consider the downside of refinancing your car loan which is owning the bank more than what your vehicle is worth.
3.Are There Additional Fees For Refinancing?
To avoid paying any hidden charges or additional fees, make sure you read the fine print and ask for more information when needed as some loans may include early termination or transaction fees.
Generally, the only fees you pay are for documents and title transfers which are usually fairly inexpensive. If a lender is attempting to charge you a large fee to refinance your car loan, you should definitely find a better offer.
4.Where Can I Refinance My Car Loan?
When it comes to refinancing your car loan, you want to make sure you are getting the best deal possible from a certified lender that you can trust. At Swee Seng Credit, we offer competitive interest rates as a vehicle finance solution provider with a loan of up to 7 years subject to your COE expiry date. Our team will be more than happy to help you through the refinancing process to make sure you get only the best.
Should you decide to proceed to refinance your car loan after asking yourself these questions, do contact us to get more information today.