×
Get 5% off in-app
400k+ download
Open app

Top 15 Auto Refinance Companies in 2024

  • Auto Refinance
  • Xavier Sabastian
  • 9 minutes

Share

Refinancing is the best option to get rid of a bad loan and save on your monthly payments. But who is the best provider? What should you be aware of when you plan to refinance? We have curated a list of top auto refinance companies in 2024 for you. Read to know more.

Save $1850 annually on Auto Refinance with Way.com!

Yes, there is an ideal cool-off period to refinance your car. It is best that you wait for at least 90 days to get the best refinance deals. Here is a list of the top auto refinance companies you can refinance your car within 2024. However, before shortlisting the car refinance company, here is an auto refinance guide that will certainly be valuable for your research.

Auto Refinancing Guide

via GIPHY

How do you refinance a car loan?  

The process in itself will take a few days or maybe weeks. Briefly, here’s how you refinance your car loan. 

  • Take a look at your current loan. 
  • Check your credit report. 
  • Gather the necessary papers. 
  • Get prequalified with a handful of lenders. 
  • Do a budget check.
  • Make a loan application. 
  • Make payments for the new loan. 

Should I refinance my car loan? 

Whether or not you should refinance your loan depends on a bunch of requirements. Even though it is legally possible to refinance a new loan, there are times when it makes the most sense. Such as: 

  • Your car loan is leading you to a financial crunch. 
  • If your credit score has gotten better. 
  • Your car loan fees are getting hefty. 

When should I refinance my car loan? 

Here are some reasons why refinancing a car loan makes sense: 

  • If your credit rating has improved. 
  • Your car loan rates of interest have decreased. 
  • If you wish to finish repaying your debt sooner. 
  • You want to lower your monthly payments. 
  • If your vehicle purchase was two years ago. 
  • You slacked off on research while financing your car. 

Pros and Cons of Auto Refinancing

There will always be the question of whether it is good to refinance your car. Here is a quick table guiding you on whether it is good to refinance your car.

Pros   Cons 
  • Your monthly car payments will be lower if you refinance for a longer time.  

  

  • In the long run, borrowing for short terms can save you money.  

 

  • May get lower rates of interest. 

 

  • There’s no need to pay a deposit. 
  • If you make loan payments last longer, your total interest will increase.  

 

  • Your monthly payments will increase if you have a lower loan term.  

  

  • Interest rate savings can be canceled out by fees for paying off the loan early or refinancing.  

 

  • A lender may charge a fee to start a new loan. 

Best Auto Refinance Companies in 2024

The first step in seriously considering refinancing is to identify the best refinance auto loan lender. Our top auto refinance lenders in the United States are listed below.

Providers  Starting APR   Loan amounts Term lengths (in months)  Credit Score
LendingTree  2.94%  36 to 72  Varies by lender  585
RateGenius  2.00%  As low as $10,250  36 to 72 550
OpenRoad Lending  2.9%  Up to $100,000  Up to 72  500
Autopay  2.99%  $2,500 to $100,000  24 to 96  560
MyAutoloan  1.99%  $5,000-$100,000  24 to 84  575
Caribou  2.32%   Up to $45,000  As low as 36  640
LightStream  8.24%  Up to $100,000  24 to 84  660
DCU    5.24%  Up to 130% of book value  Not disclosed  Not Disclosed
ILending  2.24%  Starting at $7,500  36 to 84  550
LendingClub  2.99%  $4,000 to $55,000  Not disclosed  510
RefiJet  3.49%  Starting at $5,000  24 to 84  580
Auto Approve  2.94%  $5,000 to $85,000  12 to 84  650
PenFed Credit Union  6.04%  Up to $150,000  36 to 84  Not Disclosed
Bank of America  5.99%  Up to $100,000  48 to 72  580
Gravity Lending  5.59%  $10,000 to $150,000  24 to 96  580

How to compare auto refinance lenders 

The best lender for auto loan refinancing is one that accepts your type of vehicle, has reasonable interest rates, and has little or no fees. Refinancing restrictions based on age, mileage, or other factors may be imposed by lenders. When comparing lenders for auto loan refinancing, consider the following: 

  • Type of institution 
  • Credit score requirement 
  • Restrictions 
  • Fees 
  • Discounts 
  • Reputation 

When should I not refinance my car loan? 

Refinancing a car loan can be a wise way to save money, but there are some cases where it is not wise to do so: 

  • Your car is almost completely paid off. 
  • There will be a penalty for early payment. 
  • Your credit has suffered.  
  • Your vehicle has high mileage.  
  • Your car is worth less than you owe for it. 
  • You’re submitting a mortgage application. 

Does refinancing a car hurt your credit? 

For pre-qualification, refinance lenders usually do a soft pull on your credit and then a hard pull when you actually apply. The first one won’t change your score, but the second one will bring you down a few points. 

Look for loans within a 14- to 45-day window to keep your score from going down too much. Credit companies will count these as a single pull. It’s not unheard of for lenders to ask hard questions without permission, so make sure you can trust the lender.  

Your credit score will also go down a little because a refinance is considered a new bill. Since this new account is replacing an older debt, the drop in your credit score should be very small, whether you use Vantage Score or FICO. 

Check our list of top auto refinance lenders

Auto Refinance Glossary 

Loan-to-value ratio 

It shows how much money you still owe a loan (also called the principal) compared to what the current car is worth. Divide the amount you still owe on your loan by the value of the car, then multiply the figure by 100 to get a percentage. If your number is higher than 100, you owe more than your car is worth, which is a big no-no for lenders. 

Annual percentage rate (APR) 

APR shows how much it costs to borrow from a company overall. It includes the interest rate and any fees, like transaction fees, lender compensation fees (also called prepaid finance charges), and sales tax. 

Interest rate 

Interest rate is basically how much it will cost you each year to take money from a lender. It is shown as a percentage and is added to the loan amount or debt. Note that the interest and yearly percentage rates are not the same. 

Debt-to-income ratio (DTI) 

Your DTI shows how much money you can spend. First, add up all of your regular debt payments, like rent, mortgage, loan payments, insurance premiums, and credit card payments. Then, divide that number by your monthly gross income (the total amount you make before taxes) and increase the result by 100 to get a percentage. Most of the time, lenders look for DTIs of 36% or less. 

Lease 

A car lease is an agreement that lets you drive a car for a certain amount of time. Most car rentals are done through dealerships, but some banks and credit unions can also help with the process. The lease says how much you have to pay each month to drive the car, how many miles you can drive, and other rules, like keeping the car in good shape. When your lease is up, you may be able to buy the car or hire a new one. 

Also read: How To Refinance A Car Lease: A Complete Guide For 2024

Cash-out refinance 

Also called a cash-back loan, and it’s like a cash-out buyout on a mortgage. In exchange for taking on a higher mortgage, it allows you to access the equity you’ve built up in your home. In other words, a cash-out refinance allows you to take out more money than you currently owe on your mortgage. 

Upside-down or underwater 

If your auto loan amount is more than what your car is worth, you are upside-down or underwater on your loan. Usually, lenders who help people refinance their car loans won’t sell refinance loans to people who are upside-down on their present car loans. 

Final Thoughts

Rising interest rates have an impact on automobile financing as well. However, auto loan refinancing is still a viable option for saving money. Any of the lenders on our list would be a good place to start searching for an auto refinance loan. They aren’t, however, the only lenders to think about. To discuss your auto refinancing possibilities, go to your local banks and credit unions. While visiting banks in person can be inconvenient, you do have the advantage of chatting with an expert who can explain your options.

Frequently Asked Questions 

How to refinance a car? 

Assemble all the required paperwork before refinancing a vehicle loan. Then, determine if refinancing is advantageous for you and if you qualify by looking at your credit history and car details. Many lenders allow you to submit for pre-qualification; some even post their requirements online. 

Shop around and compare offers from various auto refinance lenders before beginning the application process. Once you’ve decided which one is best for you, submit a formal application and wait for the lender to make a formal offer. If approved, you can complete the paperwork, pay off the prior loan, and begin making payments to the new lender. 

How soon can you refinance an auto loan? 

Some companies refinance car loans will work with loans made less than 30 days ago. This depends on the provider, though, so be sure to check what they need. 

What is the best credit score to refinance a car? 

No minimum credit score is necessary to refinance an auto loan. However, there is a range of credit scores considered “good” for refinancing a car loan. In general, a credit score of 700 or higher will grant access to the highest interest rates, while a score between 660 and 700 will grant access to standard rates. 

Is auto refinancing a good option? 

You should refinance your auto loan if a new loan with more favorable terms can be approved for. You may be able to save money each month if your credit has improved since you took out your existing loan. However, it’s crucial to take into account where you are in the loan’s lifespan. 

 Is it smart to refinance your auto loan? 

You can retain more money in your pocket each month by refinancing and extending the duration of your loan, but you might wind up paying more in interest over time. However, you will pay less overall if you refinance at a lower interest rate for the same or a shorter term than you do now. 

Related Posts

wave

Press ESC to close