When to Refinance a Car and When to Wait

It looks like tariffs – or at least the looming possibility of tariffs – are here to stay. But how do they work? And how can tariffs affect car prices? Let’s take a quick look at everything you need to know about car tariffs: meaning, how they work, and what to expect if you’re hoping to purchase or repair a vehicle.All About Car Tariffs (and How They Could Affect You)Let’s start with the basics.What are tariffs?You may have heard the word a lot lately, but what exactly does “tariff” mean?The simplest explanation is this: a tariff is a tax that is charged on something when it is imported. Think of it like the sales tax on a purchase when you check out at a store. It’s typically a percent of the total you’ve already paid on top of your bill. This money goes, as a tax, to the government.Here’s a practical example of how tariffs work.For example, let’s say you’re a ketchup maker. You live in Kentucky, and cook and bottle your ketchup in Kentucky, but you buy your tomatoes from Italy. You buy your tomatoes from the person that grows them in Italy, then pay to have them shipped to Kentucky. Once your tomatoes arrive in the United States, they’re inspected to make sure they’re safe and legal, and at the same time, you, the ketchup maker who imported them, would pay any required tariffs to the customs officers at the port. See? Just like a tax at check out. Tariffs can be applied by a government in different ways. You can tariff a specific item, items to do with a specific industry, or items from a specific place. They can be broad, blanket tariffs – for example, “all goods from Italy will be tariffed at 15%” – or more complicated and targeted. For example, you could have a rule where, after $1 billion worth of Italian tomatoes have been imported by everyone in the US who imports Italian tomatoes, the tariff percent goes up from 15% to 30%.Worried about rising prices?Here’s one price that doesn’t have to go up: your monthly car payment. Most people are overpaying on their vehicle loan. Auto Approve can help.Get a free quote to see how much you could save.What makes tariffs good or bad?Tariffs themselves are not inherently good or bad. Every country has tariffs on some goods. They can be applied to protect a specific industry – say New Jersey tomatoes were suffering because too many people were importing Italian tomatoes, adding a tax on Italian tomatoes might make it easier for New Jersey tomatoes to get more business. Italian tomatoes would become more expensive. You, as a ketchup maker, might pivot to New Jersey tomatoes to keep your prices the same. If enough people do this, New Jersey tomato farmers will have a more stable industry, and ideally, it’ll have a positive effect on their local and national economy.On the other hand, tariffs can cause problems for importers and consumers. Maybe you’re not willing to change your ingredients and choose instead to raise your prices. Maybe New Jersey tomatoes are more expensive than your Italian ones were. Or, having less competition, New Jersey producers might choose to raise their prices. Situations like these can mean tough decisions for people who make products that use imported goods, and higher prices for consumers. Similarly, say you can get your tomatoes from New Jersey for a better price (yay!), but your ketchup is packaged in Canadian aluminum bottles, and there are no aluminum bottle makers in all of the United States that can make your bottle. The aluminum comes from Canada and there’s no aluminum here to be had. What then? Do you change your packaging and your ingredients all at once? Look for ways to cut costs elsewhere, or simply raise your prices?This is why tariffs are usually used in a targeted way – to avoid hurting companies working inside of a country that have to pay them and to keep consumer prices from soaring.How tariffs affect American car pricesWith all of that out of the way, what does all of this have to do with cars? Well, right now, there are new tariffs being imposed on internationally-made vehicles and auto parts, plus some of the materials used to make vehicles. Will car prices go up due to tariffs?These new tariffs mean it’s likely that consumer costs will go up across the board in the auto industry. Here’s why:Because foreign cars and car parts will simply be more expensive to importBecause not all car parts or materials have domestic replacements availableIt’s easy to see why foreign cars will likely be more expensive. Since the vehicles are manufactured elsewhere, there’s no way to dodge the tariffs by changing to an American supplier. While a motivated company could choose to open an American plant, time and cost to start manufacturing in a new country and source domestic labor, space, parts, and materials might outweigh the benefits, versus simply attaching a higher price tag.But what about American-made cars and trucks?Very few, if any, vehicles are made entirely in America with American parts made from American vehicles. It is common for vehicles to have some parts made or manufacturing done in other countries, and materials like steel may be imported, either in their raw or ready-to-use form. Batteries for electric cars, for example, start with raw materials gathered from all over the world, like cobalt from the Democratic Republic of the Congo, nickel from Australia, and lithium from Argentina, and then are often manufactured in China before being shipped to the United States.Closer to home, auto manufacturing has crossed the border between Michigan and nearby Ontario, Canada, since the car was in its infancy. In 1904, 117 Ford Model Cs were produced in Walkerville, Ontario. General Motors – the Detroit-based manufacturing company that makes Chevrolets, Buicks, and Cadillacs, purchased one of Canada’s early domestic auto brands and used it to found General Motors of Canada in 1918, which is still the company’s Canadian subsidiary. There has hardly been a time when American auto manufacturing was not a cross-border affair – so it’s no surprise that there are still factories making different auto parts or performing assembly on either side of the US-Canada border. That means that tariffs on Canadian-made auto parts may well affect even familiar American automakers.Do tariffs affect car repairs?They can! If you need a replacement part, your costs may go up if that part or the materials used to make it come from somewhere else. If you’re just getting routine check-ups or happen to need something domestically produced, you should be in the clear.That said, not everyone will pass every cost increase directly onto the consumer purchasing that particle part or vehicle. Some may choose to raise all prices a little bit instead of some prices drastically to help spread out the tax burden. How each company or person in the supply chain chooses to handle changes will make a difference for if, how, and when the end consumer is affected.How to save money under new car tariffsThis might make it sound like costs will skyrocket, but there are things you can do to limit how much you feel these changes. First, you can choose to buy American wherever possible – or at least weigh the cost differential and any pros and cons of your options, whether you’re thinking about a new car or just purchasing new tires. While many American-made vehicles will still see some price increase, it’ll likely be less than what you’ll see on vehicles entirely manufactured abroad.Second, you can choose to focus on repairing your vehicle instead of replacing it. While a 25% tariff on a car part might raise its price, 25% of $200 is only a $50 increase, while a 25% tariff on a whole car could be tens of thousands of dollars. If you have the option to hold off and see how things shake out, you can ensure you get the best vehicle for your needs and budget.Be Prepared For How Tariffs May Affect CarsNow you know the basics of how tariffs work and why vehicle costs may be affected. However, in the end, the future can’t be perfectly predicted.Car tariffs are coming into place, but they may ultimately be changed or fine tuned in reaction to the market and industry. These tariffs may not have the predicted effects, depending on a variety of factors. But being prepared for a possible rise in cost is only prudent as the U.S. tariffs cars.Get the best auto loan for your budgetPrices may rise and fall, but getting a better deal on your car payment by refinancing with Auto Approve is just about always a good idea. Discover whether you’re eligible for a lower monthly payment in a few clicks – no commitment required.Get your free quote now.

Spring is a great time to think about making changes and refreshing your life – from spring cleaning to getting outdoors more. But it can also be a great time to check in with your finances. Right now especially, money is tight for a lot of average folks in the U.S., thanks to rising grocery and gas prices. If you have a car that is financed, you may be wondering whether a car loan refinance could help you save some cash. Here’s how you can tell if you should refinance your car loan in 2025. What is car loan refinancing?Car loan refinancing is when you get a new car loan that will replace your existing loan. Refinancing a loan will help you to get a better interest rate, change your repayment period, and change who is or is not a cosigner on the loan.When you refinance your loan you will go through the same process as you did during your initial financing. You will research lenders, apply for a loan, and select the loan that has the best terms, conditions, and car loan interest rate. And that’s it! It’s incredibly simple, and there are companies out there like Auto Approve who can help you navigate the world of refinance and help you through the application process. When you select a loan that is right for you, your new lender will pay off your old loan directly and you will begin making payments to your new lender. And voila–your loan is refinanced and you can start saving money immediately. When should you refinance your car loan?There are a number of signs that the time is right to refinance your car loan. Make sure you know the terms and conditions of your existing loan before you decide whether to refinance, as it’ll help ensure that the new loan you get will be better.Your credit score has improved.The car loan APR that you are offered is very dependent on your credit score. In fact, your credit score is the biggest factor that you have control over when it comes to securing a loan. The rate that you are offered will be based on which credit tier you are in. Your credit score will fall into one the following categories:800 to 850: Excellent740 to 799: Very good670 to 739: Good580 to 669: Fair300 to 579: Poor In general, you will be offered a good car loan interest rate if your credit score is in the very good or excellent range. As your score decreases, the interest rate that you will be offered will increase. Your credit score is based on five key factors in your personal finance: your payment history, credit utilization, length of credit history, credit mix, and new credit accounts. There are many reasons why your credit may have increased since your initial financing:You paid off some debt.You have been making consistent on time payments.Your available credit increased.You had a negative event expire.And more.Any improvement to your credit score can help save you a lot of money in interest, especially if it bumps you into a different category. But in general, if there has been an increase to your credit score, it is a good idea to think about car loan refinancing.The market rates have decreased Or Your Original Rate Was Higher Than Necessary.The refinance rate that you will be offered will be based in part on the current market rates. If the current rates are lower than they were when you initially financed your car, you may be offered a lower car loan refinance rate.Many people find that, even if little has changed in terms of their credit or the market rates, they may be able to pay less if they financed initial with a car dealer. Dealerships frequently mark up the market rate, so the financing received through them might not reflect the best pricing available to you. That’s why it’s always a good idea to check whether you could lower your rate – even if you don’t decide to move to the next step and refinance.You want to change your repayment period.Another benefit of refinancing is that you can change your repayment period. There are two ways that this can help you: it can either save you money in the longterm or buy you some breathing room in your monthly finances. If you shorten your repayment period, you will be paying off your loan quicker and you will therefore spend less money overall on interest. This will make your monthly payments higher, but you will save money in the long run. On the other hand, if you are having trouble making your payments every month, lengthening your repayment period will allow you to reduce your monthly payments. Since you will be paying the loan off over a longer period, the principal will stretch out and easily cut your payment by hundreds per month. You will likely be paying more interest over the life of the loan, but this may be worth it if it can make your monthly budget work for you. In general, if something big is happening (like a wedding or a personal emergency) and you need a little breathing room, refinancing may be a help – as well as lowering your monthly rate or overall interest, refinancing often means a few months’ break from paying while you make the switch.You are in a bad relationship with your current lender.Sometimes we end up in bad relationships. Maybe you don’t like the customer service and have had a few too many bad interactions. Maybe they have hit you with fees and penalties that you do not find fair. Maybe they have been unresponsive and unhelpful. Whatever the reason is, refinancing your car loan can help you get out of a bad spot with your current lender.You want to add or remove a cosigner. If you want to add or remove a cosigner from your current loan, refinancing your loan is going to be your best option. What do I need to refinance my car loan?In order to refinance your loan, you will need to have the following documents: Proof of employment or income (a paycheck stub or tax return)Proof of car insurance.A valid driver’s license.Proof of residence. This is required if your driver’s license and credit report address don’t match. A utility bill is usually sufficient for this.  Your car’s registration.Your vehicle’s information: model, make, year and vehicle identification number (VIN)Your current lender’s information and loan information, including the payoff amount.A photo of your car’s odometer Some lenders may require more information or paperwork, but these are the standard documents that most lenders will want. Is 2025 a good time to refinance my car loan?So is now a good time for car loan refinance? It really depends on your situation. Market rates are not exceptionally low, but they have fallen a bit since their peak in 2023-24. But more importantly, global circumstances might not matter for your unique situation. The rates might be lower than when you originally financed, or you might be eligible for a better interest rate than you were previously.  The best thing you can do is to look at your finances and determine if you could benefit from car loan refinance. Additionally, the rapidly changing car tariff situation makes planning to purchase a new car a bit confusing right now, so those who have the option to hold onto a vehicle a little longer rather than worry about car prices might be wise to do so – for example, if you’re thinking about an auto lease buyback. That’s how you can know if car loan refinancing is right for you in 2025. Think a car refinance might be right for you? Get your free, no-commitment quote from Auto Approve today to find out how much money you could be saving!GET A QUOTE IN 60 SECONDS

Want to know how you can improve your money management? If you’re looking to make smarter financial decisions this year, take a peek at these common suggestions from financial advisors. The reality is, as of 2022, the federal reserve reported that roughly half of Americans hadn’t saved for retirement at all and the combined household debt of all Americans rose to over $18 trillion in 2024.While reckless spending or avoiding thinking about money can feel good in the short term, taking control of your finances means a better quality of life and lower stress levels in the long run.Plus, better budgeting can mean more money in your pocket for the things that really matter. One way to spend smarter and save? Refinance your vehicle loan with Auto Approve and find a rate that works for you.Shore Up Your Personal Finances with These TipsEach of these suggestions comes from reliable online sources in the money management world. For personalized advice and to make sure you’re making the right moves for your unique situation, be sure to speak with a financial advisor directly.1. Save more for the futureUnless you happen to be one of the less than 9% of Americans with at least $500k saved for retirement – which is, by the way, estimated to cost about $1 million, depending on personal circumstances and spending habits – most financial professions would likely suggest you make a plan to save more as soon as possible.There are many different ways to save for emergencies and retirement – Health Savings Plans, 401Ks, Roth IRAs, simply buying bonds to grow your cash – and choosing the right one for you depends on your job. But however you do it, saving money in case something happens or to allow you to eventually retire is one of the most responsible financial actions you can take.2. Make and keep a budgetWhether you’re looking to actively save more or one of the roughly half of all Americans who’ve had to carry credit card debt within the last year, sitting down and making a budget can be a huge help.Many financial gurus recommend subscribing to the 50/30/20 rule – meaning 50% of your income goes to needs, 30% to wants, 20% to savings or paying down debt.For many people, simply taking a close look at their finances can be intimidating. However, the more you know what’s coming in and going out of your accounts, the better a handle you’ll have on your finances. Having more control over where you’re spending and when means you can choose when to splurge and on what so you get the most out of your money.3. Learn about investing – and then do it!First, you should know that every investment comes with a certain level of risk, and that you should only take the risk you’re comfortable with and can afford. That said, broadly speaking, investing – especially in relatively stable places like index funds and ETFs – is the easiest way to make sure the money you save keeps up with the market over time. To be clear, you should still keep an emergency cash fund on hand, plus enough for your expenses. But once you’ve done some saving, it’s financially wise to start thinking about putting some of those savings into a diverse portfolio of investments, whether that includes Certificates of Deposit with guaranteed interest, buying property, or entering the stock market. A good financial advisor will make sure you understand the risks of any choices you make and sound investing principles, but for now, you can read up on the basics.4. Manage debt thoughtfullyMost finance folks would agree that there is good debt and bad debt. Good debt typically includes debt that acts as an investment in your future – think student loans and mortgages. Bad debt includes things like payday loans and credit card debt – high interest borrowing that can get you caught in a debt cycle. These debts can drag you down financially without offering much benefit to you in the long term.Paying down a credit card every month and building your credit can be a good thing, but be careful about borrowing for discretionary purposes like vacations. If you’re someone who has struggled with debt, there are tons of resources available to help you figure out how to set yourself up for success in terms of paying down your debt and getting your finances back on track.5. Pay attention to your spendingAs well as keeping a broad budget, it’s always a good idea to actually audit your individual costs, especially if money is tight. You can save money at the grocery store, at the pump, and throughout your budget with a little bit of care and attention. Subscriptions and other recurring fees are one of the easiest places to get dinged by forgetting about a free trial or not noticing the creep up of a monthly bill. If you want to reduce your spending, you can look for forgotten subscriptions, see if there are ways to get your bill lowered, or cancel certain subscriptions until you need them.You may also be able to lower your monthly expenses by lowering your payments on leases and mortgages through refinancing. At Auto Approve, we work with you to find the best deal for you on your vehicle loan refinance. Then we do the paperwork for you, making it easy switch loan providers. Most people are overpaying on their auto loan, because car dealerships typically markup their rates. That means, if you got your loan through a dealership, you’re likely eligible to pay less per month with a lower rate.Get Your Finances In Tip-Top Shape With These Money Management TipsMoney matters don’t have to be difficult or intimidating. The best thing you can do for your financial health is to take a close look at what you’re earning, what you’re spending, and how you’re spending it. Once you’re intimately familiar with your personal finances, you can take charge and make sure your money is working for you, today and for years to come.Consider saving for your future, keeping a close eye on your budget, investing wisely, avoiding or paying down bad debt, and exercising discretion in your spending. With thoughtful application of these tips, guided by your financial advisor, your finances can be healthier than ever.Want to Lower your monthly car payment?Take charge of one monthly expense right now. Find out how much you could save on your car loan by refinancing with Auto Approve today. Getting a quote only takes a few minutes, costs nothing, and requires zero commitment.Get your free quote now.