Refinancing Your Auto Loan May Save You Thousands
July 8, 2004 — Charlotte, N.C. – If you've considered refinancing your auto loan to save money, you may think you've missed the boat now that rates are on the rise. Refinancing your auto loan is one of the best-kept secrets and it's still not too late — you might be eligible for a lower rate than you realize.
According to Brian Regan, chief consumer officer of LendingTree, Inc., "Many people finance their auto loans directly through their dealer, which is convenient. What consumers don't realize is that they don't always get the lowest rate they qualify for from the dealer, which could cost them more money over the life of their loan."
To evaluate an auto refi loan, consider both your interest rate and term of your loan. To reduce the amount you pay overall, refinance your loan at a lower rate for the same, or reduced, term. It may slightly increase your monthly payment, but if you can afford it, you can pay your loan off quicker and save more money in interest.
If you're looking for a way to keep more money in your pocket now, lower your monthly payments by refinancing your loan at a lower rate and extending the term. Just remember that doing this may increase the total interest paid over the life of your loan.
How much can refinancing really save you? By refinancing a $28,000 auto loan from an 9.0 percent interest rate to a 5.75 percent rate, over 60 months, you could save $43 a month, which adds up to $518 a year, or $2,590 saved over the life of the loan.
Helpful Hint — Make sure to compare a number of loan offers before you refinance. Knowing the lowest interest rate you're eligible for before signing on the dotted line will help you get the best deal for your wheels.
About LendingTree, Inc.
Founded in 1996, LendingTree, an operating business of IAC/InterActiveCorp (NASDAQ: IACI), is the leading online lending exchange that connects consumers, Lenders, REALTORS®, and related service providers. The LendingTree exchange is made up of more than 200 banks, lenders, and brokers (Lenders) and has facilitated nearly $75 billion in closed loans since inception. The company's Realty Services offering connects consumers to a nationwide network of more than 700 real estate companies and approximately 10,000 REALTORS®.
REALTOR® — A registered collective membership mark that identifies a real estate professional who is a member of the National Association of REALTORS® and subscribes to its strict Code of Ethics.