When is the Best Time to Refinance a Car?

When should you refinance your car loan?
Check out LightStream Loans if you want to refinance: bit.ly/LS_AutoRefinance
(I may be compensated by LightStream through this link.)
Watch more car buying videos: • How to Negotiate a Car...
Ever wanted to know when the best time to refinance a car is? I'll cover when you should refinance a car loan and I'll go over why you should do it today (if you can get a better auto loan rate). Refinancing a loan on a car is much more simple than a mortgage, so I thought I'd clarify the process in this video. You can refinance a car anytime you want and don't need to wait 6 months unless it's actually stated in your contract.
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#honestfinance #refinance
0:00 Introduction
0:06 Why Refinance?
0:19 When to Refinance?
0:31 Interest Rate Credit Score
1:33 Cant refinance for up to a year?
2:19 Check out local Credit Unions online
2:48 Hard credit pull
4:03 2-3% interest rates
6:06 Prioritize the Rate
6:38 Keep the same term
6:51 36 month loan
7:11 Pay interest on what you owe
7:27 Pay off loans quickly
7:55 Credit score goes up

[@vinsonnguyen8717]

This video helped me out a lot! I made a call to my local credit union right after watching the video and a 2% rate reduction might be in my future now. I can always count of your channel for real, no bs advice that is relevant to me. Thank you for all that you do.

[@ranyat4782]

Thank you! I'm a new car financer haha and so this gave me so much more insight that I have no idea as the car company keeps calling and texting me to reduce my rate as they want to refinance I'm a little iffy but thanks so much!!

[@travisbrown7705]

Thank you for explaining this so well

[@Antz49]

I’m refinancing now old loan 25% interest due to really bad credit now good credit new loan 3.25% huge difference

[@HonestFinance]

Wow that’s such a big difference !

[@ccdanie00]

Hey! If you don’t mind me asking how long did you wait to refinance?

[@Antz49]

@@ccdanie00 a year cause my credit skyrocketed after getting my car credit got to a 700+ credit score and a local credit union approved me immediately

[@jdigitalseven7]

I think they get around it by having an early payoff within 6 month of car loans too. They can retroactively increase interest if paid off early with some lenders.

[@valeriadrewmartinez4086]

You explain so well. Thank you !!

[@l3anzai28]

Straight to the point 🤝🏼 Subbed

[@HonestFinance]

Thanks and welcome to the channel :)

[@pragmaticinvestingtools7484]

You have a fantastic channel. Keep up the great work. I'm looking forward to seeing more. New subscriber here!

[@HonestFinance]

Thanks! Welcome to the channel

[@HonestFinance]

How many times do I say "Keep that in mind"?? Watch more car buying/refinancing videos: kzbin.info/www/bejne/qKiylHR-ia1nhdU

[@AlexGomez-hd7ji]

Good stuff. Learned a lot. More to learn!

[@awesomecatvideos4723]

Man I like this guy. Straight Forward to the point. No nonsense crap. I'm definitely subscribing.

[@HonestFinance]

Thanks!’

[@TheJayrockerr]

I agree☝🏻. He gets straight to the point. I subscribed, as well.

[@KajunSpice902]

Thank you for this video! Helpful!

[@HonestFinance]

You’re welcome and I’m glad it helped

[@K24z7]

Wow these numbers were spot on for me, really helped me understand. Thank you im feeling more confident in refinancing things.

[@HonestFinance]

You’re welcome and good luck!

[@ange1vega]

I WENT FROM 13.6 TO 2.99!!!! PAYMENT WENT FROM 640 TO 460!! OWED 52 MONTHS NOW BACK TO 60 WITH NEW LOAN, I THANK YOU FOR THE VIDEO BROTHER!!

[@HonestFinance]

You’re welcome. That’s so much better

[@adrianaguilar1208]

where did u apply to refinance the car

[@ange1vega]

@@adrianaguilar1208 Tower Credit Union, 2.99%

[@tallkekepink95]

I’m currently at 9.45% for 84 months. Made a mistake by allowing the dealership to find financing for me. Tomorrow will make a month from that APR and I got approved with Bank of America at a better finance rate. 6.59% at 48 months to be exact. But I really want a 3%! They say it’s because my credit history is long that long.

[@ololadeadetula3522]

What was your past and recent credit score for that rate change?

[@tonycamisi4821]

This was so helpful, thank you so much.

[@HonestFinance]

You’re welcome. Thanks for watching

[@tonycamisi4821]

@@HonestFinance 😁

[@dariusbrown8644]

Great Video! Thanks for your help

[@HonestFinance]

You’re very welcome

[@mehmet-eu3df]

hi thanks much for video🙏 but i couldnt find anywhere whats the dmv process of refinancing , do i need to pay registiration fee again ? or do i need get new insurance plan , how it works , thanks in advance

[@TheJayrockerr]

Great advice, as usual Jason. However, the issue I am running into. My vehicle is a 2009. Even though, it is a Lexus. Most banks / credit unions say it is too old of a vehicle.

[@lizgaby9761]

Jesus.... what did I do!🙄 my interest is like 15.99% $440/month 😭 I got an offer from capital one to refinance and interest would be 7.99% which... I'm about to call right now but had to look for infor since I've already made mistake one 😅 thanks for the advice and info. Subscribed!

[@josuetorres8414]

I have a 24% interest rate😂

[@mindsinmotion2825]

I just refinance my car after one year of buying it when they drop the interest rates and my interest dropped 5%. It was easy and the best thing ever.

[@wilber19541]

How old is the car,if the car is over two years old and you are still paying for it...you are losing money.

[@dukebryant4417]

@@wilber19541 what do you mean

[@Chyroscale]

What if your wanting to get a new car? I have a high interest rate and a high payment because my credit is great and I wanted to refi but I want a new vehicle

[@TheAndrewLopezFinancePodcast]

Always good to refinance a car if you can get a better rate. Great tips as always!

[@wilber19541]

Pay cash,and you dont need to refinance....best rates on cars...and dont buy new.....

[@El.KompaLalo1850]

@@wilber19541 no mames u need credit history to buy a house some ppl can’t afford to buy cash.

[@wilber19541]

@@El.KompaLalo1850 what is a credit history.....

[@teuilamalo9020]

@@wilber19541 to see if you pay on time and stuff with things

[@WayApp]

Thank for sharing!

[@HonestFinance]

You’re welcome

[@eddycervantea7882]

Thanks for the info, keeping me calm nd shi lol

[@mrpitman6735]

After a repossession how long should you wait too try and buy another car ?

[@makatkplt]

I refinanced my car twice when I was younger so I can say without reservation; buy a cheaper car. Paying interest on a depreciating asset is wrong; we know this. 20% down and paid off in 48mos. No exceptions!!!

[@playboysosexy1]

Funny your example is what i did 20k at 6% hopefully going to 2% when i refinance

[@mosmith3026]

I'm financing a new 2021 Honda motorcycle from the dealer. I've put 20% down. I have another lump I could put down but was considering putting it towards principle aftermy first payment. I've never had an auto loan, I'm only financing the bike to add some diversity to my credit profile. Please respond thanks!

[@wilber19541]

You need HELP....how much for the bike,I bet if you walked in and said' how much if paying cash....you would have got a great deal....if you dont have the money at the time to pay cash,then cant afford it...I bet in 1 year,working over time,or just buy several,low cost cars at auction,and selling for profit....hhhhmmmmmm

[@SEXYDREAD09]

Awesome. Thanks

[@HonestFinance]

You’re welcome. Thanks for watching

[@shortyshorty1216]

How will it take for you're credit to go back up???

[@chuymg358]

Any advice on cash out refinance ? I have a really good equity in the value of the car against what I owe , thanks

[@HonestFinance]

Depends on what you’re using the cash for?

[@americanbanana]

We have a loan payment of $69k on our truck for another 4 years at 4.79%. My 401k offers a personal loan at 0.75%. I’m hesitant to pull money from my retirement to pay down the Interest. Or would this be a good idea? Thoughts?

[@HonestFinance]

I probably wouldn’t do that. I bet there are a lot of fees associated with it on top of interest. I’d refinance ASAP w your local credit union for 36-48 months and that’ll help the situation

[@LilMozzyKosa]

If I just bought a car first time buyer, and just established credit when’s the best time to refinance ? How many months should I wait ?

[@HonestFinance]

You don’t have to wait at all. Just check w your local credit union and they can help. If not, just wait a couple months for your credit score to increase and try again

[@wilber19541]

If you just bought a car on credit,take it back....NOW

[@RandomvidszTV]

Im new to this financing thing , just financed a 2021 nissan sentra it was 23k but with an apr of 19% so the dealer didnt tell me i was gonna owe the bank 50k and my credit score is 630 and now that i got the paper work im so mad idk what to do

[@HonestFinance]

I’m sorry. 19% is too high. Just go to your local credit union and see what they can do to get you into a better loan

[@deedeec4305]

Hello, how long does it take your credit to increase from the first payment you’ve made on a car? My interest rate is 10.79% monthly payments is 433.04. I’ve made 5 payments so far. One credit Union said I was better off keeping who I have now (Chase). Any advice?

[@tallkekepink95]

Interest rates are horrible right now. Credit unions are not helping right now. Try other banks. Bank of America gave me a 6.59% at 48 months.

[@zackcarneiro6218]

I’m buying a Jeep Wrangler and my apr is 14%, I have a 700 score but they said I need history

[@TimmyStreams1234]

I had no problem with my car dealership but I’m not happy with the answer he gave me when I asked when can I refinance he lied about it

[@angelwonderland281]

I just bought a car last month at a dealership and my boyfriend who lives in a different state and knows about car told me they ripped me off ,that the car is not worth the price that I'm going to pay for .can I refinance it with another dealership? I really don't know about cars and my boyfriend is not here with me. What steps should I take to refinance that car?🙏

[@HonestFinance]

Just go to your local credit union and see if they can help

[@justinwasil11]

I bought a truck 2 weeks ago they gave me 6.8% is that good then I went and bought a truck last week same dealership they gave me 12.8% they said because I bought the first vehicle should I refinance the second vehicle before it shows up on my credit? To get a lower rate to get a lower payment?

[@HonestFinance]

Go to your local credit union and they’ll probably have better rates on both trucks . Refinancing is not too hard with cars

[@godmercy3926]

Hey man so I was with capital one at 12% but my credit union want to offer me 6% saving of 120 on my current payment of 400 .. what you think?

[@HonestFinance]

Go for it!! I’d even ask if they can go lower than 6% to compete w other credit unions. 12% is a terrible rate, so I’d refinance asap

[@pearlsmith99]

Hello, I bought a toyota yaris 2017. It's a used car & I've had it since June or August of 2019. My interest rate is 18%, I'm guessing because my credit was low at the time or I had no existing payments. My question is that I pay back the loan to Santander USA. Apparently, they do not offer refinancing on existing Santander loans. Do you know if there is another option. I pay $206 a month & haven't been late on any.

[@HonestFinance]

Refinance with your local credit union and they’ll pay off the existing loan. That’s what I’d do

[@lizgaby9761]

I have the same lender.... my interest is 15.99% but capital one is offering 7.99%. Did you end up refinancing?

[@pearlsmith99]

@@lizgaby9761 no not yet. I realized if I do refinance my monthly payment will be higher. I can't afford it.

[@lizgaby9761]

@@pearlsmith99 has your credit score not gone up? Why would your payments be more? I ended up refinancing with Capital one yesterday. Monthly payments are 400 now from 440 and I did that on purpose since I could also do 385 but that would mean paying it for more months. I had 68 months left now 62🤣 maybe not super different but anything helps.

[@pearlsmith99]

@@lizgaby9761 oh ok, and yes it has. I did my research if I want a lower interest rate, my monthly payments have to be more. And my months to pay it will be shorter. Im at 206 right now. And it should be done by 2023. I think I'm just going to stick with it. I'll check out capital one though. If I'm able to get more hours in at work. I could go the route you did.

[@Highdrogen300]

I have a 5% in interest rate and I owe 8k on my car that I’ve been paying for 3 years now from 23k. Capital one offers refinancing do you recommend I do it or just keep paying as I have?

[@Notallwhowanderarelost98]

At this point you’re paying mostly principal. Just double up on payments

[@richardcastro166]

@@Notallwhowanderarelost98 yep ,give extra

[@crazedtxf100]

do you go to the dealership to refinance or do u got to a bank and talk to them to refinance ?

[@HonestFinance]

Go to your local credit union

[@bmbkg4266]

so if i got a car lease from one company, i can get it refinanced at my credit union?

[@HonestFinance]

Yes

[@isaiahdelarosa3525]

I got 23% interest rate paying 836 for a v6 2019 challenger I payed my second payment today and I really wanna lower the payment because I’m struggling I just don’t wanna go to the bank and waste there time and mine I was planing on going to EECU…my credit scores 760

[@isaiahdelarosa3525]

Listening to the rest of your video it’s probably gonna save me a lot going in tomorrow thank you

[@HonestFinance]

Please try w your local credit union . It’s not a waste of anyone’s times . 23% is not okay and it’s needs to change asap

[@mike.3727]

How would I go about finding out if waiting to refinance is in my contract? Can I just call and ask? Didn’t get anything saying that was in the contract, and wasn’t mentioned by the salesman either.

[@mike.3727]

Great video btw, just gained a new subscriber

[@HonestFinance]

You’re probably not under contract to refinance. You can always call though

[@kylyn4861]

How much does it effect your credit?

[@HonestFinance]

It varies, but not much

[@AlexRaePersonalFinance]

Good tips, but I definitely encourage people to pay cash if possible! Financing a souped-up $40,000 luxury car is pretty much always a bad idea for most people, and refinancing isn't going to help much.

[@kingvintage2227]

Why pay cash tho ?

[@tunina6421]

This is generally true, but I'd say trucks are a bit of an exception. Trucks generally will have a substantially lower rate of depreciation, and ironing out issues during the warranty period has saved me a ton of money personally. You also never really can tell what people have done with trucks and it's not uncommon to see relatively low mileage well kept trucks that were absolutely abused with towing and off roading. Unless I'm allowed to do a full diff teardown, I'm generally pretty uncomfortable buying a used truck. But yeah with cars I always buy low mileage used and drive them till they are really high mileage.

[@tunina6421]

​@@kingvintage2227interest and depreciation with loans generally mean you pay 1/3-1/2 (sometimes higher or lower depending on credit) what the sticker price is on top of the sticker price. Buying a car in cash also means you don't have to abide by contractual agreements with loans. It's always better to pay cash. The exception is what I have stated. Now in my circumstance, I had paid a very high down payment and took out a short term 10k loan. With a truck, you generally won't go upside down doing this and on top of that, you are certain the vehicle is being serviced properly and have a bit of grace with warranty coverage

[@hashbrown7669]

I just bought a car 2 days ago and I fell victim to the dealership and let them stick me with a 18% rate.. I’m 19 and a first time buyer w no co-sign. Should I try refinancing my first payment is due 9/18.. what if I have prepayment penalty does that matter?

[@HonestFinance]

I'd refinance as soon as you can. Go to your local credit union and see what they can do

[@hashbrown7669]

Honest Finance yea I got it down to 9% I’m gonna do it again in a few months

[@HonestFinance]

Good job! That’s a lot better

[@nataliasnation6458]

@@hashbrown7669 may I ask what bank you went for ? I’m currently in the same boat it’s been 7 months since I purchased my car. With a credit score of 684 ..

[@fatimatouourodjobo914]

hi, this is my first time to apply for a car loan to refinance. i don't have any credit score. could I be qualified.Thank you

[@HonestFinance]

Maybe, but I’d highly recommend you go through your local credit union to get approved

[@fatimatouourodjobo914]

@@HonestFinance thank you

[@fatimatouourodjobo914]

@@HonestFinance do i need car title before get a Loan?

[@johnpaulmartinez6219]

What if I have 14 more payments on the Loan and my rate is 10.24 should I refinance

[@wilber19541]

Sell the car, and buy one from your local auction....

[@JoseGarcia-pz9qf]

18% apr Jesus is that bad? My first used car 2014 ram and just got a letter saying I can refinance and lower it more than half

[@definitionXrp]

if I sign up for car loan while my credit is 600 and 1 year later I have a 660 should I refi??

[@HonestFinance]

I’ll always recommend you refi as soon as possible if your rate isn’t very good . So if your score goes up in a month, refi in a month

[@duymariochannel3885]

I financed from Bmw finance. I pay 5.49% in interest for 9months. I know my credit score is up now. Where can i refinance? Bmw dealership or local credit union?

[@HonestFinance]

Go with a credit union, but you might not best 5.49% these days

[@dfrmotorsports4591]

Interesting about the month thing... Local dealership toys me i need to make a minimum 8 monthly payments because i can refinance, and that i could go back to them to refinance lol i refinanced yesterday (4 months since purchase) with another local lender

[@HonestFinance]

They’re probably just holding onto their commissions

[@dfrmotorsports4591]

@@HonestFinance i was typing absolutely horrible when i wrote that comment lmao im not sure how it works, just that the dealership required a minimum 8 months of payments before refinance was an option for me haha

[@HonestFinance]

Well it’s probably not true unless it’s in the contract.

[@emanuelbeltran4098]

So the car is 15687 after my down payment I got approved and I’m making 483 payments and interest is 28% the truck is a 2011 tundra and now it’s at 28k I only have 8 month credit history could I refinance? The person that was doing my loan told me to wait 6-7 months

[@emanuelbeltran4098]

My equity credit score is 715

[@HonestFinance]

I’d refinance with a credit union asap . 28% is awful

[@admperry1]

Hello, I just watched your video. I would like to Refinance my car, it's @12ish % I've paid 47% off the contract. I called my Finance lender and said they don't report to the credit bureaus, I was so disappointed because I am trying increase my credit score, especially to refinance, any suggestions? Thank you in advance! 🙂 LightStream didn't compare to some of the others.. 8% to 15% lowest % for excellent credit my credit score is approximately 617 right now.

[@HonestFinance]

Try your local credit unions. And the debt should be reported to affect your credit score

[@ithosmagnanima]

I want to refinance to pay less and pay quick. Not really looking to pay less just pay off with lower interest rate. Right now it's at 8.8%. What do y'all recommend? HELP!

[@HonestFinance]

Refinance with your local credit union. Rates are about 2-3% right now

[@ithosmagnanima]

I will check on that! Thank you!

[@HonestFinance]

You’re welcome

[@kalifola3911]

Paying for a 2015 Tacoma at 18% interest 850$ a month with no co signer. Any advice? Been making payments on time for half a year.

[@kalifola3911]

My credit is little below 600

[@HonestFinance]

That’s a high rate. Try to refinance through a credit union and you’ll probably get a better rate.

[@donjuan2731]

Any updates I’m currently in that same ball park area??? 3:06

[@HonestFinance]

If you’re in the same boat, go to your local credit union and try to refinance .

[@ohnobo14]

Going from 12 to 2%

[@HonestFinance]

That’s amazing. Great job!!

[@shaleaveney3422]

I recently brought a Camaro back in June as my first car after joining the military with NO CREDIT so my interest is very high . My credit score is now sitting at 654 and I’m looking to refinance next month but do not know how I should go about it or how to even refinance ? Can you walk me through the steps I need to take ?

[@HonestFinance]

It’s very simple. Look up your local credit unions and see who has the best auto rates. Then go into their branch and ask to refinance. They’ll help you refinance if you qualify

[@TedStrang]

also talk to the person at the bank, 661-780 is usually the next credit score bracket, so maybe wait til your FICO score is over 661 to get even better rates.

[@Dark3Kill3rr]

Should you do it on credit karma recommendation?

[@Dark3Kill3rr]

Did you ever do It? Currently going through this

[@alexx9563]

Paymets are 923$ month 3.73% apr is it worth refinancing??

[@HonestFinance]

You might end up w a rate about 2.5%-3%. That’s a little better, but your rate isn’t horrible.

[@HonestFinance]

It’s worth trying with your local credit union if you can save money on interest

[@thatguy666ism]

The example he used with the 20k loan is almost my current situation except I have a 12% APR and I’m 2 years in...my credit score did go up by it’s below 700 as of now...I’m still not sure if I should refinance or wait for my credit score to go up?

[@mirandalizarraga5996]

Update? Currently in a similar situation with similar credit score. Did you end up refinancing?

[@alxmajestic]

@@mirandalizarraga5996 i just did. It eent down to 6.4 interest rate. Same months and payment went down 100$

[@gwillis01]

hello there

[@duliolemus5634]

I pay 500$ on 13% interest rate from a car from CarMax with 65 months left credit score about 680, should I refinance? How much can I lower my monthly payment?

[@duliolemus5634]

?

[@HonestFinance]

I’d go to your local credit union and refinance now. 13% is a very high rate and I’m sure you can get a better payment too . Since you have 65 months left, go with a 60 month loan or less

[@duliolemus5634]

@@HonestFinance looks like I’ll do that this Saturday , I got the car from CarMax i have about 20,000 left to pay off thank you for the advise

[@HonestFinance]

What other questions do you have?

[@joeymcguire6011]

My current interest rate is 9% new offer is 5.46 but its not a 48 month term its 75! I dont think i want this Update. My current term is 9% and i have 63 months left. This actually isn’t as bad as i thought. For whatever reason i thought i had 48 months left.

[@HonestFinance]

Why not start the new loan at 60 months?

[@Beast9894]

OMG 2-3%? that's insane. Mine was 12% with 750 credit score. 35k car would cost like 70k after all that interest smh

[@John-sw3cd]

Hey man, so i pay 23.49% in interest to my 2013 civic for 72 months. $346 is my monthly payment, the principal only takes about $90 to less the loan. I’ve had it for 7 months and i paid on time. Does this means i need to refinance? Pls answer. Thank you.

[@HonestFinance]

Yes you should 100% refinance as soon as possible. Go to your local credit union and they’ll help

[@nick__cars]

Omg 😱

[@3ofus135]

Ouch!

[@deltondecoster1305]

I refinanced my truck about 3 months after purchase and my credit dropped 50 points.

[@D_Bills_Racing]

Has it bounced back yet?

[@nickr473]

@@D_Bills_Racing ?

[@leilamartinez9533]

What should i do? My dumbass recently got a used 2015 hyundai tucson with 21.89% interest rate and owe $23,000 for 60 months? My first payment is on October 22nd? Should i refinance or wait until i get my credit up? :(

[@loveandgamingxx1744]

Good videos though...

[@wilber19541]

Poor video,if you like to be in debt....buy a used car,pay cash..it may not be pretty,but it will get you around..the money you save,can be used to pay off other bills,if you have any..

[@Domyfz450]

I owe 23 k on my truck you think I should refinance ?

[@groovyferny9061]

Yes , If you have a decent credit score it will help you get a cheaper payment .

[@loveandgamingxx1744]

Maybe, have shares with MARA AND RIOT Cryptocurrency. Might not need to refinance if bitcoin keeps going

[@ttr8141]

You don’t finance cars, period. You save up and buy one using cash. With financing, you’ll end up over time paying more for the car than it was worth. And with zero percent financing, the car price is marked-up to make buyers think they’re getting a deal when they are not

[@wilber19541]

Why not pay cash...financing a car is nothing but allowing yourself to be fleeced....do the math....

[@NoKreativeUsername]

Yes, Dave Ramsey wannabe

[@jagsfanrick]

You are funny, not sure how many people got 40 to 50k cash laying around.

[@Ethsbeefs]

Financing a car is a great way to build your credit. Although I bought mine cash it is a good idea if you can get a good rate just to boost your credit long term.

[@wilber19541]

@@NoKreativeUsername..yes cash does talk...and what is a FICO score anyways....my house ,cash .my car, cash,my new 1.5 acres cash...and a good suggestion is to actually read "Dave Ramsey's book".

[@wilber19541]

@@Ethsbeefs you dont need a FICO score when using cash. If you are using cash your FICO score will automatically be high. P.s. someone is teaching you all wrong.