A car loan refinance is like trading your old vehicle for a new one. As you outgrow your vehicle, you might want to consider getting a new one. Even without enough cash on hand, you can do this through a car refinance. You trade the salvage value of your first car and then re-apply for a new car loan, a cheaper one since you’ll have your old car surrendered and its current value deducted from your new car loan.
What are the benefits of a car loan refinancing?
A car refinance can allow you to have a brand-new car. A brand-new car has fewer maintenance costs, compared to an older one. Brand new cars are also fuel efficient, thus giving you savings in the process.
As your situation change, you might need a bigger car. If your current work requires moving a few products, a bigger car would be more ideal for you. Having a family may also affect your transportation needs. If you feel that you are in these situations, a car refinance would be lighter on the budget.
There are many other positive reasons why you should consider getting a refinance. Check out these reasons and then talk to an Intellichoice broker to get expert advice whether a car refinance is indeed time for you.
1. Lower interest rates
If you had a bad credit car loan approved for your first car, you might want to consider getting a refinance if your financial situation has already improved. You can get a regular car loan to refinance instead of car loans with bad credit refinance. Such loans offer better rates. With a better credit score, you can get better deals on your car loan now.
2. If you want to get a better car
After 12 months of successful payments on your car loan, you can already apply for a refinance. If you intend to apply for a refinance, you should do it after a year to keep the value of your car high. It would be difficult to refinance a car loan if the amount you owe is greater than the value of your vehicle.
3. Minimize current loan charges
Talk with a car loan broker and ask if a car refinance would give you lower monthly fees and other payments associated with it. Although there are additional fees included when refinancing, you should include this cost on the possible new charges and compare it with your current monthly fees.
4. New features for your loan
Car loans come with different features and they vary from time to time. If you are eyeing for a new car loan with more features, beneficial for you as a client, you might want to consider a refinance.
5. Having a hard time paying for your loan
If you are having a hard time paying for your car finance, you might want to consider getting a refinance. You can opt to get a new loan with a longer loan term, giving you a lower monthly payment to worry about. Although the interest earned by your principal would be higher, you will be able to allocate your budget to other important things besides your car loan payment.
Who offers car loan refinancing in Australia?
Car refinancing is offered by lenders, the big four banks in Australia as well as other small lenders to clients with good credit scores as well as to those with black marks on their credit file. Car loans for bad credit refinance are for clients that currently have a bad credit score, regardless whether their initial loan is a regular car loan or is already a second chance car loan.
The right time to apply for a car finance is as early as you decide to do so. Remember that you are using the current value of your vehicle as a sort of payment to lessen the amount of car loan you will need to procure a new car. The higher the value of your vehicle is, the better interest rates and deals you will enjoy.
Ready to take a car refinance? Call Intellichoice Finance and let our expert car loan specialists guide you through the process.