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Here’s the quick version: Understeer and oversteer are terms used to describe how a moving vehicle takes turns.Understeer is when the vehicle doesn’t turn as much as it needs to or feels like it should—you have to turn the steering wheel more than you’d expect.Oversteer is when a vehicle turns more than you want it to—it seems extra sensitive to steering.Read on for the longer answer and an explanation of how oversteering and understeering happen, and how it might affect your choice of vehicle when buying a new or used car.Oversteer vs. Understeer: Your Complete GuideIn this article, you’ll find answers to the following FAQs and common concerns about oversteer and understeer:What are oversteer and understeer?What causes a vehicle to understeer?What causes you to oversteer?Which is better, oversteer or understeer?Which vehicles are more likely to over or understeer?What that means for your choice of vehicle when buying a carHere’s what you need to know.What are oversteer and understeer?Oversteer and understeer are terms used to describe a vehicle’s response to steering and sensitivity to changes in steering angle when combined with acceleration. Basically, they describe what happens when something doesn’t go quite right when you’re turning.What causes a vehicle to understeer?Understeer happens when your vehicle loses traction on its front wheels and doesn’t turn as much as you expect it to. It looks like going straight when you want to turn, or taking an extra wide turn. As an example, understeering might happen if you start accelerating too early while turning, in which case you’d need to gently slow your acceleration.What causes a vehicle to oversteer?Oversteer happens when you lose traction on the back wheels of your vehicle and it turns too much, with the back of the vehicle swinging out further than you might want it to. It looks like turning more than necessary, or “drifting.” For example, you might end up oversteering if you take a turn too fast or brake sharply, in which case, you’d need to steer against the slide—similar to what you’d do if you found yourself sliding on ice or hydroplaning.Which is better, oversteer or understeer?That’s contextual! Oversteer is sometimes considered better for performance driving, like racing, because it allows the vehicle to make sharper turns and more easily accelerate out of a turn. However, for general driving on public roads, understeer is preferred, because it’s safer than spinning out on the road. If you panic while understeering, you’ll likely go straight forward, meaning any collisions are typically taken by the front of the car, which is designed to take more impact. Which vehicles are more likely to over or understeer?Oversteering and understeering are caused by how weight is distributed in a vehicle and tire condition.Rear wheel drive vehicles, like sports cars, are more likely to oversteer, while front wheel drive vehicles, like most common sedans and hatchbacks, are more likely to understeer. AWD and 4WD vehicles vary, with some modern models built to mitigate either effect, but they generally tend toward understeering too. Smooth driving, especially when turning, and making sure you have the right tires for your roads (kept in good shape!) are the best way to avoid under or oversteering.Thinking about oversteer and understeer when buying a carIf you’re worried about having a vehicle that’s prone to understeering or oversteering, here’s what you need to know.Understeer is generally safer, so you probably don’t want a sports car or other rear wheel drive vehicle if you’re concerned.Choosing the right tires is as important as the make and model of your chosen vehicle.Driving safely and smoothly is a good way to generally avoid either effect under most circumstances, especially if you have well-maintained, weather-appropriate tires.Keeping your vehicle well-maintained so you know if anything isn’t quite right can also help and is always a good idea.You can look into any specific models you’re considering buying before signing to find out if they have a known tendency to over or understeer.Bonus tip: If you’re thinking about buying a vehicle, read our guide to dealership markups and negotiate to get a better rate.And that’s everything you need to know about understeer versus oversteer.Use this quick and handy guide to stay a little safer on the road and understand the mechanics of what happens when a vehicle understeers or oversteers.Paying too much on your vehicle loan?We’re Auto Approve, by the way. Auto Approve is your auto loan refinance partner, helping you find the best rate available to you and handling the paperwork to make lowering your monthly car payment quick and easy. Whether you’re thinking about a new vehicle or locked into a loan, when you’re ready to refinance, Auto Approve can help.Get your free, no-commitment quote right now.

Here’s the quick version of what you need to know. People typically get rejected when they apply for a vehicle loan for one of a few key reasons: Bad credit Too little credit Other financial issues, like a high debt-to-income ratio Application issues, like a typo in your social security number or missing backup documentation to prove your income (unverifiable income) If you’ve recently been rejected for an auto loan and aren’t sure why, you should receive or have received a letter, called an Adverse Action Notice, which details why you were rejected. While the reason may be unsatisfactory, it’s also the best guide you’ll get for how to avoid rejections in future.Vehicle Loan Application Denials: Your GuideIf you have ever applied for a car loan or auto refinance only to be rejected, you may feel disheartened (and maybe even a little bit confused). But all is not lost! Understanding why you were turned down can help you get approved in the future, and correcting any problems can even help you get a better car loan APR (annual percentage rate) than you’d otherwise have qualified for.In this guide, we’ll answer the follow frequently asked questions about car loan rejections:Why was I denied a car loan?What happens if you are denied a car loan?What should I do if I am denied or want to avoid a denied loan?Read on to learn more about why someone might get rejected for a car loan (and what you can do to avoid a rejection or make sure it doesn’t happen again).Why Was I Denied A Car Loan?Getting denied a car loan is not uncommon. There are quite a few reasons why it may happen to you, and there are always ways to fix your situation to ensure that you can get approved for a car loan in the future.Take a closer look at the 4 most common reasons for a car loan denial:Poor credit Application errorsDebtToo little credit Your Credit Score Is Poor.A poor credit score is the most common reason to be denied a car loan. Credit scores are broken down into the following categories:Exceptional (Super Prime): 800-850Very good (Prime): 740-799Good (Near Prime): 670-739Fair (Subprime): 580-669Very poor (Deep Subprime): 300-579 If your credit score is fair or very poor, you will most likely have a very difficult time getting approved for a car loan. A score of at least 620 is recommended to get approved for a car loan. The better your score is, the better the car loan APR you will be offered. There are auto lenders for people with poor credit scores, but they have high interest rates and tend to have more penalties and fees associated with them. There Were Errors In Your Application.It’s also relatively common to be denied for a car loan due to a simple error in your application. If you forgot to fill out a section or mistakenly answered a question, you may be denied a car loan. If your denial letter lists something that seems unfamiliar, you may want to take some time to double check that your application was accurate and complete.You Have A Large Amount Of Debt.If you have a high debt-to-income ratio, you may be denied a car loan. Lenders look not just at your income and credit score, but at the totality of what you owe, including mortgages, student loans, credit card debt, and more. If the amount you owe is relatively high when compared to how much income you bring in, lenders may see you as a risky applicant.You Don’t Have A Long Credit History.If you do not have a long credit history, lenders may be reluctant to loan you money for a car. There simply isn’t enough information to determine whether or not you are a good candidate for a loan.What Happens If You Are Denied A Car Loan?The good news is that getting denied a car loan doesn’t automatically hurt you (besides meaning that you do not have the new car you want). But if you are rejected for multiple loans that all pull hard inquiries on your credit report, that may lower your credit score slightly. Lenders are required to tell you why you were rejected for the loan. If they do not state the reason in the initial response, reach out and inquire. They have 60 days to respond (if they do not respond, they will be in breach of the Equal Credit Opportunity Act).It may take some work, but in most cases you can fix whatever caused you to be rejected in the first place.What Should I Do If I Am Denied, Or Want To Avoid A Denied Car Loan?If you are denied a car loan, there are several steps you can take to ensure you get approved the next time around. If you haven’t applied yet, but are worried about any of these factors, the remedies are the same.If You Were Denied Due To A Poor Credit Score.If you were denied a car loan because you have a poor credit score, you can work to improve your credit score for the next time you apply. Your credit score is based on five different categories:Your payment history (35%): Are your payments on time and in full? Your amounts owed (30%): How much debt are you in and how does that compare to the amount of credit you have available to you? The length of credit history (15%): How long have you had your accounts open?Your credit mix (10%): Do you have a healthy mix of accounts (such as a mortgage, credit card accounts, student loans, etc)?  Your new credit (10%): Do you have new accounts where you haven’t proven your ability to repay?There are many factors that go into your credit score, so taking the time to review your credit report will give you a good sense of what areas you can improve in. Improving your credit payment history is the most effective thing you can do to increase your score, as it has the largest weight for your credit score. You can improve this category by committing to making full and on-time payments to all of your accounts. Signing up for autopay is one great way to ensure you don’t miss a payment. But, if you’re already making on-time payments, there are lots of other steps you can take to improve your credit score and give you a better chance at getting approved for a car loan:Review your credit report for errors or mistakes.Request higher credit limits on your accounts. This will decrease your credit utilization ratio and improve your score.Pay down accounts that have high credit utilization ratios (the ratio of debt you are in compared to available credit).Catch up on any past due accounts. Consider contacting a credit counselor if this feels too overwhelming. They can design a debt repayment plan that will work for your budget.Limit applying for new accounts. These can trigger hard inquiries which can lower your score.Building your credit score takes time, but it is definitely worth it. Having a good credit score will help you get approved for loans, get better interest rates, and help you get better insurance rates.You Were Denied Because Of An Error In Your Application.Most of the time you can simply apply again, but be sure to double check that everything is correct the second time around. A common reason for this is something called unverifiable income – this means you need to provide more evidence of your income, like tax returns, recent pay stubs, or bank statements showing recurring deposits. Basically, you need to provide more paperwork.Pro Tip: If you’re applying to refinance, you can work with one of Auto Approve’s refinance experts and they’ll do the paperwork for you to avoid errors in future!You Were Denied Because You Have A Large Amount Of Debt.If you have a large amount of debt you should definitely prioritize paying some off before you put yourself in even more debt. There are several ways to achieve this depending on your circumstances.You can use the avalanche method, which involves paying off your debts by order of interest rates. By paying off your highest interest rate debts first, you will help save yourself further costs in interest. This is one of the most popular (and quickest) ways to pay off debt.You can use the snowball method, which involves paying off your debts by size, starting with the smallest amount first. This is great for your morale and can keep you motivated to pay off your debts.But whatever method you use should start with a solid budget. Creating a budget is the best way to organize your finances and can help show you where you can cut costs and save money. Contacting a debt consolidation service can also help you to get organized and keep on top of your payments.You Were Denied Because You Don’t Have A Long Credit History.This is a tricky one. There is no quick fix to getting approved if you do not have a long credit history. It can take you several years to build up your credit score. Getting a credit builder loan is a great step to take when getting started. Credit builder loans deposit money in a savings account, and once you pay off the balance the money is released to you. Your payments get reported to the credit bureaus and can give your credit score a good raise so long as you make full payments.Secured cards are another way to help build credit. These cards require you to deposit money in order to open an account. This is referred to as your security deposit. Paying the minimums on these accounts can help you establish credit.You can also consider applying for a car loan with a co-signer or co-borrower. When you apply with a co-signer, lenders take both of your credit histories into account. If your co-signer has a good score, you will have a much better chance of being approved for a loan. Additionally, making payments on your new car loan will help you build credit. A co-signed loan is in your name and you are responsible for payments, but your co-signer will be responsible if you default.You can also apply for a joint loan, where you and your counterpart will share equal responsibility for the loan (a co-borrower). Lenders will again consider both of your credit scores and histories when determining eligibility. Making payments will help you to build your credit, and you can finally get the car you’ve been wanting.While Getting Rejected For A Car Loan Can Be Disheartening, There Are Ways To Make Sure It Doesn’t Happen Again.Take steps like:Checking your credit report for issues and errorsChecking your application for errors or adding more documentation to support your listed incomeWorking to improve your credit scoreWorking to build your credit historyPaying down debts or asking to raise your credit limit to improve your debt-to-income ratio and credit utilization rateBringing on a co-borrower or co-signerOffering a bigger downpayment so you’re applying for a smaller loanAnd if you already have a car loan and are looking to refinance, Auto Approve can help! Get your free quote today to find out how much you could be saving.GET A QUOTE IN 60 SECONDS

You might be wondering: Does refinancing hurt your credit? Here’s the short answer: Auto refinancing will cause a slight temporary dip in your credit score when your credit is checked and you take out a new loan. However, refinancing can help you get a lower rate and/or lower your monthly payments, so it’s still worthwhile for many drivers—and can actually help your credit in the long run.Read on for a more in-depth look at refinancing, credit scores, and how and why refinancing can impact your score.How Auto Refinancing Can Affect Your Credit Score: The Complete GuideIf you’re thinking about refinancing your auto loan, it’s only natural to want to know what will happen to your credit score. After all, credit scores can seem confusing and complicated, and maintaining a good score can be crucial for many major life events.So, it’s important to understand how this financial move will affect your overall financial picture before deciding whether or not a refinance is right for you.In this guide to how refinancing can affect credit scores, we’ll discuss the following frequently asked questions about car loan refinancing and your credit score:What is auto refinancing?How are credit scores calculated?What is considered a good credit score?How will vehicle refinancing affect my credit score?How do you reduce the impact of refinancing on your credit score?Is refinancing worth it?What Is Auto Refinancing?Auto refinancing is when you pay off your existing car loan with a new car loan. Your new loan will ideally have more favorable terms that will ultimately save you money.To understand how vehicle refinancing will affect your credit, we will need to look at how credit scores are calculated.How Are Credit Scores Calculated?Credit scores are used to help lenders assess how likely you are to pay back your debts.Credit agencies typically look at five factors to determine your credit score:Payment historyAmounts owedCredit history lengthCredit mixNew creditHere’s a closer look.Payment HistoryThis is the most important factor in calculating your credit score, accounting for 35% of your FICO score. Do you have a history of on time payments? Lenders want to be sure you will pay back your debt on time.Amounts OwedThe amount of money you owe, your debts, are used to calculate your credit utilization score. This is the second most important factor in your credit score. This is calculated by dividing your total debt by your total credit limit. For example:Let's say, between all of your outstanding accounts, you currently owe $5,000. Your combined credit limit for all of these accounts is $50,000. 5,000 ÷ 50,000 = .1 = 10% Credit UtilizationA credit utilization score below 30% is considered desirable for lenders. This score accounts for 30% of your FICO score.Credit History LengthThe age of your credit accounts make up 15% of your FICO score. They look at the age of your oldest account, the age of your newest account, and the average age of all accounts. Having older accounts and a longer credit history is more favorable to lenders.Credit MixHaving a diverse assortment of accounts is beneficial to a high credit score. A healthy mix might include a mortgage, auto loan, student loan, and credit cards. This indicates to lenders that you can manage your money across multiple accounts. A healthy credit mix accounts for 10% of your credit score.New CreditThe number of new accounts you have opened plus the amount of hard inquiries you have had on your credit account for 10% of your credit score. People often ask, “how long do hard inquiries stay on your credit?”. The answer is about one year. If you have had a significant amount of inquiries in this time period, it might be a red flag for lenders.What Is Considered A Good Credit Score?Credit scores typically range from 350 to 850. 800 to 850: Excellent credit740 to 799: Very good credit670 to 739: Good credit580 to 669: Fair credit300 to 579: Poor creditPeople with the highest credit scores will more easily be approved for loans and credit applications, and will typically get the best interest rates and annual percentage rates (APRs). Using the above factors, credit bureaus calculate a credit score for every person with a credit history.How Will Vehicle Refinancing Affect My Credit Score?The short answer: Refinancing will cause a temporary dip in your credit score, but may help raise your credit score long term.The long answer: Here are the factors that determine how refinancing a vehicle will affect your credit score.Lower credit score (now):Hard credit checkCredit history lengthNew creditRaise credit score (later):Payment historyCredit mixAmounts owedHere’s the details.Refinancing will affect categories used to calculate your credit score: credit history length and new credit. Having a new account will negatively affect your credit history length, and the hard inquiries and new account will also affect the new credit category.However, it is important to note that hard inquiries only last a year on your credit score, so that will only be a temporary ding. Credit bureaus know that people contact multiple lenders when looking to open an account, so they allow a two week timeframe where all inquiries will count as one hard inquiry. In other words, don’t let fear of lowering your credit score hold you back from shopping around for the best rates.And, in the long term, having the loan that makes sense for you will make you more likely to make on-time payments, and once the credit checks are gone and the loan is no longer considered new credit, you’ll have a good mix of credit and build your credit history.How Do You Reduce The Impact of Refinancing On Your Credit Score?To reduce the impact that vehicle refinancing will have on your credit, be sure to:time your refinance to not come immediately before or after another hard credit check or new credit linedo research ahead so you know what you’re looking for and what will work for your budgetunderstand how credit scores are calculatedcomplete all of your applications in a short period of time (under two weeks) so that all hard inquiries will count as one inquiry in the allotted windowIs Refinancing Worth It?The short answer:Refinancing is worth it if:interest rates have gone downyour credit score has gone upyour budget is tightyou want to add or remove a co-borroweryour car is worth more that your loanThe long answer:This depends entirely on your situation, but it is often worthwhile to take a temporary hit on your credit score to improve your overall financial health. If you refinance and take a ding on your credit, the hard inquiry will only remain on your score for one year. The age of your accounts will also lengthen over time, so your credit history length will not be affected permanently. If refinancing makes it easier for you to keep up on your monthly payments, it may help your credit score in the long run.In short, should any of the following apply to you, it may be worth refinancing your vehicle:Interest Rates Are Going DownIf interest rates are trending downwards, it might be beneficial to refinance your car loan. Your overall savings will negate the temporary hit on your credit.Your Credit Score Has IncreasedIf your credit score has increased, you have a better chance of qualifying for a lower interest rate. Check your credit score at one or all of the three major credit agencies (Equifax, Experian, and TransUnion) and see how your current credit score compares to your score when you originally took out your auto loan.You Need Extra Cash Every MonthIf money is tight, refinancing might alleviate your monthly payments. If you are in danger of making late payments or defaulting on your loan, this will severely damage your credit score. It is far better to refinance and take a small hit than risk defaulting.You Need To Add Or Remove Someone As A Co-BorrowerIf you need to either remove or add a co-borrower to your loan, refinancing will allow you to do so.Your Car Is Retaining ValueIt is important that your car is retaining its value if you want to refinance. Owing more than the car is worth is called being “upside-down” in your loan. You will have a hard time finding a lender if this is your situation.Now You Know How Refinancing Your Auto Loan Will Affect Your CreditWhether or not it is worth it to refinance your car loan will depend on your situation, but the benefits of refinancing will often outweigh the dip that you might see on your credit score. If you are ready to start your refinance or want more guidance on whether or not a refinance is right for you and your unique financial position, Auto Approve can help.Get the ball rolling with a free, no-commitment quote to check your eligibility and see how much you can save, then work with one of our refinance experts to compare quotes and find the best deal for you.Get your free quote now. 

You’ve probably heard the term APR tossed around a lot. But what does APR stand for, and what is the difference between interest rate and APR? While these terms are similar, they are not exactly the same. Here’s what you need to know:APR stands for annual percentage rate. Your APR is the total cost you pay per year for borrowing money in a loan. It includes your interest rate, but also any other fees and markups. That’s why it’s important to know your interest rate and your APR when you’re thinking about taking out a loan or refinancing. Your Complete Guide to Car Loan APRs (Annual Percentage Rates)In this guide, you’ll learn everything you need to know about interest rates, APRs, and how they are calculated.Table of ContentsThe difference between interest rate and APRHow to calculate APR on a loanHow car loan interest rates are determinedHow to get a lower APR on your car loanWhat Is The Difference Between Interest Rate And APR?Interest rate and APR are often used interchangeably in the car loan industry, but they are not exactly the same thing. An auto loan’s interest rate is the cost of borrowing money every year, expressed as a percentage. It does not include any fees that are charged for the loan. An auto loan’s APR (Annual Percentage Rate) is the cost of borrowing money every year, expressed as a percentage, including any associated fees.So while they are similar, they are not exactly the same. The APR is considered to be a more accurate measure of the cost of the loan, as it takes all of the fees into account as well. The Truth in Lending Act requires lenders to disclose all loan terms and fees, so they are obligated to alert you to anything that you are responsible for paying. Since all lenders must disclose the APR, it is a valuable tool for comparing loan terms.Note: Be sure that you are always comparing APR to APR, not APR to interest rate. You always want to compare apples to apples.Here’s How To Calculate APR On A Loan.A car loan APR is calculated using the interest rate that you are offered. Here are the basic steps to calculate APR on car loans.Determine the interest amountAdd any administrative fees to the interest amountDivide by the principalDivide by the number of days in the loan termMultiply by 365 (one year)Multiply by 100 to convert to a percentageIn other words, here is the APR formula: APR = ((Interest + Fees / Loan amount) / Number of days in loan term)) x 365 x 100Let’s put this to use. Math class is in session! For example, say you are borrowing $20,000 to finance your new car. You have a 5% interest rate and a four year loan period. The closing costs on your loan are $700. Principal (P) : $20,000 Interest Rate (R) : 5% Time (T) : 4 years The interest on the loan can be found with the formula: Total Amount Accrued = Principal (1+Rate x Time) Total Amount Accrued = 20,000 (1+.05 x 4) Total Amount Accrued = 20,000 (1.2) Total Amount Accrued = $24,000So now we know our total amount accrued is $24,000, and our accrued interest $4,000 (Total Amount- Principal Amount). Now we can put all of this in our APR formula. APR = ((Interest + Fees) / Loan amount) / Number of days in loan term)) x 365 x 100 APR= ((4000 + 700)/20000) / 1460 x 365 x100 APR = 5.875 %So while your interest rate is 5%, your APR is actually 5.875%. This number more accurately represents the actual annual cost of your car loan.How Are Car Loan Interest Rates Determined?While the car loan APR is what you should be comparing, this number is based on the interest rate that you are offered. But how are car loan interest rates determined? Why do these rates vary from person to person?Car loan interest rates are determined by:Market factorsYour creditYour incomeYour loan termMarket FactorsCar loan interest rates depend in part on how the economy is performing. Interest rates are set by the Federal Open Market Committee (FOMC). If the committee determines that spending needs to be encouraged, it will lower interest rates to do so. Conversely, if inflation is high, they might raise market interest rates to slow things down.Read our guide to how interest rates are determined for a more in-depth look at how this works and why it might be relevant to your financing or refinancing options.Your Credit Score And HistoryYour credit score is the most important factor in your car loan interest rate. Credit scores are the biggest variable from application to application. Your credit score takes into account the following categories: Payment History. Do you have a history of on time payments? Have you missed payments in the past? Lenders want to be sure you will pay back your debt on time. Amounts Owed. How much money do you owe? The amount of money you owe, your debts, are used to calculate your credit utilization rate. A credit utilization score below 30% is considered desirable for lenders. Credit History Length. How old are your accounts? Having older accounts and a longer credit history is more favorable to lenders. Credit Mix. Do you have a mix of different types of accounts and debts? A good mix might include a mortgage, auto loan, student loan, and credit cards. This indicates to lenders that you can manage your money across multiple accounts. New Credit. Do you have a lot of hard inquiries on your credit? Do you have some brand new debts? These might be considered liabilities by lenders.Your IncomeIn addition to your credit score, lenders will also look at your income and your debt-to-income ratio. If you are carrying too much debt, the lenders may only offer higher car loan interest rates as they consider you to be a riskier candidate.The Loan TermIn general, the longer the loan term is, the higher the interest rate you are offered will be. Lenders will offer lower rates for shorter terms. This means that if you select a longer lease period, you are not only paying a higher car loan interest rate, but you are paying it for a longer period of time. This means you will end up paying a lot more money overall by selecting a long repayment period. On the other hand, if money is tight, choosing a longer loan term can mean a lower monthly payment, which may be the right choice in certain circumstances (for example, if you need a car for work and can’t afford a higher payment), despite the downside of more interest paid over the life of the loan.How Can I Get A Lower APR Car Loan?If you are looking to secure a new car loan or refinance an existing loan, you’ll likely want to find the lowest APR car loan you’re eligible for. Here are a few actions you can take to increase your chance of securing a good car loan interest rate:Get your credit report and review for errorsRequest higher credit limitsKeep your credit balances below 30%Make on time paymentsShop around and compareStep 1. Get Your Credit Report And Review For ErrorsContact one of the major credit bureaus (Equifax, Experian, and TransUnion) to get a free copy of your credit report. You can get your report from each agency for free once per year. Review your report carefully and look for any inconsistencies. Are the dates of opened accounts correct? Are the balances on each account accurate? Is your payment history correct? Make sure that all credit limits are up to date and that all personal information is accurate. If you notice any errors, report them immediately. Step 2. Request Higher Credit LimitsThe higher your credit limits are, the lower your credit utilization ratio will be. This ratio looks at the amount of money you owe and the amount of money available to you. Lenders will often increase your limits throughout the years when they review your information, but you can also try requesting a higher limit. This will help your score as soon as it is reported to the credit agencies.Step 3. Keep Your Credit Balances Below 30%Keeping your balances to less than 30% of your available credit will help your credit score greatly. This will lower your credit utilization ratio, as discussed above. Those with the highest credit scores often use less than 7% of their available credit, so keep that in mind when you are looking at your accounts. Working to keep a low credit utilization ratio will help your score immensely, and with it your eligibility for a low APR. Step 4. Commit To On Time PaymentsMaking consistent, full, and on time payments will help your score a lot. Sign up for autopay if you are able to, or set an alert on your calendar if you have a tendency to miss payments.Step 5. Shop Around And CompareThe car loan interest rates that you are offered will vary greatly from lender to lender, so you really want to prioritize shopping around. Remember that you can and should negotiate on the interest rate and fees you’re offered, especially if you’re considered dealership financing.If you are looking to refinance, Auto Approve makes shopping around and comparing incredibly easy. We have relationships with 50+ trusted lenders all across the country and can easily help you apply and compare offers instantly. And That’s What You Need To Know About APRsNow that you know all about car loan interest rates and annual percentage rates, or APRs, you’re ready to go out and get your best loan or refinance—and if you’re refinancing, Auto Approve is here to help. If you’re ready to refinance an auto loan, get your free, no-commitment quote today.Get a quote now.

Here’s what you need to know. You should consider refinancing your loan if any of the following are true:your credit has improved and/or your finances have improved (for example, if you've lowered your debt-to-income ratio) market rates have droppedused car values have gone up you got your loan from a dealership or otherwise got a bad dealyou're having trouble making your monthly paymentsyou want to pay off your loan earlier than originally plannedyou want to add or drop a co-borrowerAnd you've had your loan at least 6 months and have at least 2 years left on your loan.If one or several of these conditions apply to you, you’re likely eligible for a beneficial refinance! Check your eligibility and get a quote before making any official applications that require a hard credit check, then shop around for your best offer. If your credit has dropped, market rates are high, or your loan is very new or very old, you may want to wait or avoid refinancing, unless you can no longer afford your car payments and need to consider taking a less beneficial loan in order to keep your car and maintain your credit. Refinancing is a simple way to lower your monthly car payment in a pinch.Read on for more details about when to refinance, when you should wait, and what you need to know about the refinancing process.When To Refinance An Auto Loan: Your Complete GuideIn this guide, we’ll take a closer look at the following common refinance questions:When should you refinance a car loan?What should you not refinance a car loan?How do you refinance a car loan?Refinancing a car is a bit of a game when it comes to timing. You get the most bang for your buck when the stars align, but if it’s not meant to be it can be a waste of time. So how do you know when the time is right to refinance, and when the time is not right?Let’s talk about when you should refinance your car and when you should wait.1. When Should You Refinance A Car Loan?Car loan refinancing has a lot of benefits, but the biggest benefit is that it can save you money. However, in order to save money, the timing must be right. Here are a few signs that you might benefit from car loan refinance:your credit score has improvedthe market rates have decreasedyou want to pay off your loan earlyyou are having trouble making your monthly paymentsYour Credit Score Has ImprovedYour credit score is the number one thing lenders look at when determining your eligibility for a car loan refinance. It will also help them to determine what interest rate you should be offered. Credit scores give lenders a good indication of how likely you are to repay a loan. A high credit score tells lenders that:You make on time paymentsYou are not in too much debt You can manage making payments across multiple varying accountsThe better your score is, the better the interest rate you are offered will be. If your credit score was so-so when you initially financed, the interest rate that you were offered might not be ideal. But if you have worked to improve your credit there is a good chance you will qualify for a better interest rate. There are many reasons why your credit score may have improved in the past few years:You made full and on time payments to your accountsYou paid off some debtYour debt to income ratio improved (either due to decreased debt or increased income)A negative event expired (such as a bankruptcy)You have a better mix of creditIf you are considering car loan refinance, it’s a good idea to get a copy of your credit report and look for any errors. Correcting any errors can improve your score a good deal. Reviewing your report can also give you an idea of what areas you can improve on. But if your score is higher than it was when you initially financed, refinancing might be worth it.The Market Rates Have DecreasedAnother way you can secure a lower interest rate on your car loan is if market rates have decreased since you initially financed your car. The car market has been all over the place in the past several years, so this will very much depend on when you actually financed.You Want To Pay Off Your Loan EarlySure, there are ways to pay off your loan early without refinancing. But if you do refinance your loan, you can save money while doing so. When you shorten your repayment period, lenders will often give you a lower interest rate which can save you a significant amount of money. If you couple this with a better credit score, it can mean a significantly lower interest rate. A shorter period also means you will be paying interest for less time, so you can save a lot of money in the long run.You Are Having Trouble Making Your Monthly Payments.Even if you might not necessarily qualify for a lower interest rate, refinancing might still be a good idea for your finances. When you refinance your loan, you can change your repayment period. If you are having trouble making monthly payments, lengthening your repayment period can spread out your repayment over more time and thus reduce your monthly payments a good deal (we are talking hundreds of dollars per month). While you will end up paying more over the life of the loan, this can still be a good move for you. Loosening up extra money every month can allow you to allocate that money to other payments, which may be important to you and help your overall financial health.2. When Should You Not Refinance A Car Loan?Just as there are times when refinancing your car is a great idea, there are also times when refinancing does not make sense. If any of the following apply to you, it might not be a good time to refinance:you have an older caryour loan is underwateryour loan is less than six months oldyour loan has less than two years left on ityou have a lot of prepayment penaltiesYou Have An Older CarIf your car is older or has a lot of miles on it, chances are you will have a hard time refinancing your loan. Cars that are ten years old (or older) or have more than 100,000 miles on them are less likely to be approved for refinancing. Your Loan Is UnderwaterIf your car loan is underwater, you will have a very hard time refinancing it. This means that you owe more on your car than your car is worth. A car loan can become underwater if you do not put a large enough down payment on your car initially and/or make minimum payments on your account. Certain types of cars have a higher rate of depreciation, so simply having a car with a high depreciation rate can mean your loan can end up underwater.Your Loan Is Less Than Six Months OldIf your loan is less than six months old it is a good idea to wait a little longer before you refinance. While there is no strict rule on how long you can wait to refinance your loan (you generally only need to wait as long as it takes for the paperwork to go through), experts recommend waiting at least six months to a year. This will give your credit score a chance to bounce back from the hard inquiry and give you a chance to establish that you are making consistent payments. This can lead to a better interest rate and better terms for your refinance. Your Loan Has Less Than Two Years Left On ItIf your loan has less than two years left on it you may have trouble getting approved, or it may simply not be worth it to you. Car loan payments are designed so that you pay the bulk of the interest upfront. The nearer you are to the end of your loan period, the less you will actually save on interest as your payments will primarily be going towards the principal (this is called an amortized loan). The earlier you refinance the more you will be able to save on interest payments.You Have A Lot Of Prepayment PenaltiesSome car loans come with hefty prepayment penalties. These fees might outweigh any benefits of refining, so do the math before you commit to moving forward.3. How Do I Refinance My Car Loan?Gather your informationResearch and applyCompare and signIf it seems like now is a good time to refinance your car loan, working with a company that specializes in refinancing is the best option for most people, like Auto Approve. Auto Approve makes the application process simple and quick, with a network of trusted lenders to help you find your best deal and refinance experts to help you decide which loan is the best for you. Step One: Gather Your InformationThe first step to refinancing is gathering all of your information. You will need the following information to get the process started:Current loan information. You will need the name of your current lender, your account number, and your payoff amount. It’s good to have the contract handy to compare specific terms as well. Personal information. You will need identification, proof of employment, proof of residence, and your contact information.Vehicle information. You will need your car’s VIN, make, model, year, and mileage.Step Two: Research And ApplyYou should aim to apply with 3-5 different lenders for your refinance. Read online reviews, ask friends and family, and determine which lenders might be a good match for you. Consider a mix of traditional banks, credit unions, and online lenders. When you narrow your list down you can apply. Or, apply through Auto Approve and you’ll have access to our network of 50+ trusted lenders to help you find the right deal and comparison shop quickly and easily.Step Three: Compare And SignWhen your offers come in, be sure to compare all of the terms. Look at the interest rates, the repayment period, the prepayment penalties, and all of the other terms. When you decide on a loan, you can simply sign and start saving. Your new lender will most likely handle paying off the old loan, but be sure to double check that this is done before stopping payments!Now You Know How To Determine If It’s A Good Time To Refinance Your Car Refinancing can help you to save a lot of money, but only if the time is right. If you use Auto Approve for your refinance, we’ll help you with the entire process. From selecting which lenders to apply with to determining the best fit for you, our experts are your advocate for the refinancing process. If you’re ready to get started, we can help you determine if you qualify and guide you through the refinance process. Get your free, no-commitment quote to find out if now is the right time for you!Get your quote now.

Here’s What You Need To Know. Ultimately, the best place to get a car loan will depend on your situation. Your options to get financing include: At the dealership From a traditional bank or credit union Through an online lender Typically, to get your best possible loan, you’ll want to shop around a little and get pre-approved before you go in to buy a vehicle. Dealership financing is likely to include some pretty substantial markups, so don’t be afraid to negotiate not just on the terms and car price but on the APR and fees attached to your loan. Getting pre-approved can make that negotiation easier, even if you know you’d prefer dealership financing.Already got a loan through a dealership? Millions of Americans with dealership financing are eligible for lower rates and better terms than the ones they’re currently locked into. Lowering your payment through a refinance is quick and easy.Find out how much you could be saving.Regardless of where you decide to apply, it’s important to make sure your credit is in good shape and that your credit score is as high as possible. Shopping around and comparing rates is key when determining the best lender for your situation.The Best Place to Get a Car Loan: Your Complete GuideIf you are looking for a car loan, there’s good news and there’s bad news: the good news is that there are a lot of places that can help you secure a loan. The bad news is that there are a lot of places that can help you secure a loan. When there are so many options, it’s hard to know what the best choice will be. In this guide, you’ll learn about the options you have when looking for a car loan, steps you can take to get your best rate, and tips to help you decide which lending option is right for you.In this guide, we’ll look at:Where vehicle loans are offered (and the pros and cons of each option)How to get the best rate on your auto loanWhere Can I Get A Car Loan?There are four key kinds of lenders for auto loans:Car dealershipsBanksCredit UnionsOnline lendersCar Dealerships The advantages: ConvenienceThe disadvantages: Higher rates, higher pressureThe bottom line: Dealer financing is not the best place to get a car loan, but if you need a new car and are having trouble getting approved elsewhere it may be your best bet.One of the easiest ways to get a car loan is to simply go to the dealership and arrange for financing when you purchase your new car. Dealers make it easy for you to do everything in-house. They have relationships with certain lenders and can approve you on the spot for financing. This can be good or bad depending on your situation. The biggest advantage to dealer financing is that it is convenient. You don’t need to make any effort other than showing up at the dealership with the necessary paperwork. But with convenience comes the one major disadvantage: you cannot shop around and compare. Taking the time to research and compare rates and lenders can help ensure that you get the best rate, the best terms, and overall best loan available to you. Dealer financing is generally more expensive because the dealer is tacking on additional fees or additional interest on top of the lender’s loan. You are paying for a middle man in addition to paying the lender. Some dealerships have in-house financing companies, which are referred to as captive finance companies. These companies are lending institutions in and of themselves. Captive financing may offer more discounts since they have control of the underwriting process, but they may also inflate prices and can be much more aggressive when trying to upsell you.Traditional BanksThe advantages: Competitive rates, many locations, great customer serviceThe disadvantages: Less flexibility, not great for those with poor creditThe bottom line: A traditional bank is a great place to get a car loan if you have good credit, but if your credit is less than stellar you may have a hard time securing a loan.Going to a traditional bank is a great option for many people looking to secure a car loan. Banks can usually offer the lowest rates and the best terms. However, these rates are reserved for those with the best credit scores and credit history. You may find limitations and restrictions when using a traditional bank—for instance, many traditional banks will not finance a car that is over a certain age or mileage.  Credit UnionsThe advantages: Competitive rates, great customer service, more flexible than traditional banksThe disadvantages: May not meet membership requirements, do not have a lot of locationsThe bottom line: A credit union is a great financing option for many people. They often have the lowest rates and great customer service, but you may need to shop around and determine your eligibility. Credit unions operate in a similar way as banks do, but they are not for-profit and instead distribute their profits to their members. They tend to serve specific locations or communities,as opposed to a traditional bank that might have branches throughout the country or the world. Credit unions may have membership requirements, but they offer many benefits, often offering better interest rates than traditional banks. They can also be more flexible for those who may not meet the standards of a traditional bank. Online LendersThe advantages: Lots of options to compare, competitive ratesThe disadvantages: Requires more research and vetting, which makes this option much more time consumingThe bottom line: If you have the time and patience to use an online lender, you may find the most competitive rates and best terms for your car loan.Online lenders have become an increasingly popular option for car loans in the past decade, and it’s easy to see why. When looking for an online lender, you can easily shop around and compare interest rates and terms. There are so many online lenders that there are usually options for every type of applicant. If you have poor credit, an online lender may be your best bet to get approved, although you will likely end up with a very high interest rate (subprime borrowers can get stuck with loans upwards of 22%). If you have great credit, you may find the most competitive rates online, rates that may even beat those offered by traditional lenders. But these lenders vary greatly in terms of reputation and customer service, so it’s imperative that you do your homework before signing with any online lender. These companies typically require much more vetting than would be necessary with a traditional bank or credit union.  How Can I Get My Best Car Loan Rate?While there are a lot of different places where you can secure a car loan, they all take the same factors into consideration. Your best available car loan rate will depend on the following factors:Your credit score and credit reportYour income and employment historyYour down paymentYour loan termYour carThe current economic conditions Each of these factors is looked at carefully when the lender is determining what car loan rate they will offer.Your Credit Score And Credit ReportThis is the biggest factor that is within your control that will dictate the car loan rate you are offered. Your credit score is a fast and easy way for lenders to determine how creditworthy you are and how likely you are to repay a loan.  Below 580: Poor580 to 669: Fair670 to 739: Good740 to 799: Very Good800 and up: ExceptionalBy fitting your score into one of these brackets, they can easily decide if you are responsible with your accounts and able to manage your money. Lenders can then take a closer look at your credit report to learn more about your financial health. Do you pay your bills on time? Are you in a lot of debt? All of these factors will help lenders decide what rate you are offered. The higher your credit score is, the better your interest rate will be.Concerned about your credit score or payment history? Here are a few resources to help you get your finances on track before applying for financing or refinancing. Improving your score and reducing your debt-to-income ratio can make a huge difference in the financing available to you.What is A Debt-to-Income Ratio and Why Does it Matter?Credit Scores and Car LoansFour Ways to Pay Off Credit Card DebtA Beginner’s Guide to Budgeting: Pay Down Debt Fast8 Simple Tips to Help Improve Your Credit Score Your Income And Employment HistoryLenders want to ensure that you have a source of income to pay for the new car you are getting. They will not want to give you a loan where your payments will be $800 a month if you are only earning $1000 a month.  Your Down PaymentDown payments are important for a lot of reasons, and a sizable down payment can even lower your interest rate. Lenders view you as less risky if they see that you have made a large down payment. Your Loan TermIn general, you will be offered a better interest rate if you select a shorter repayment period. Your loan payments will be higher every month because you are not stretching out your repayment period, but you will save a lot of money in interest.  Your CarThe car that you are buying will also affect the interest rate. New cars come with lower interest rates because they will have a higher resale value should you default on your loan. If you are buying an older car, you may have a harder time finding a loan in general.  Current Economic ConditionsThe only factor that you have no control over whatsoever is the current economic conditions. When the economy is dealing with high inflation, the interest rates will be higher to curb spending and try to stabilize the economy. There is nothing that you can do to change this, so your best bet is to wait until the interest rates go down before securing a new loan. This is not always possible, however, so shopping around for the best rates available to you is especially important when rates are high.Now You Know How To Get The Best Car Loan For You.There are many different lenders that offer car loans, so the more research you do, the better off you will be. Research your options, negotiate where appropriate, and don’t let yourself get pushed into a deal that doesn’t work for you. Already have a car loan but want a redo?Get in touch with Auto Approve today! Our experts can help you refinance your loan and lower your car payment, interest rate, or both.Get your free, no-commitment quote.

What paperwork do you need to refinance a vehicle? Here’s the short version. Refinance Paperwork Checklist Driver's licenseSSNProof of addressProof of incomeCar detailsProof of insuranceVehicle registrationCurrent loan informationRead on for a closer look at these items and more on what you need to do to refinance your car and lock in a lower car payment.Prep and Paperwork for Auto Loan Refinance: The Complete Guide In this guide, we’ll take a closer look at what’s required and why, other things you might want to consider looking at or having on hand before refinancing, and how to set yourself up to get the best refi deal available to you.Table of ContentsAbout RefinancingPaperwork BreakdownBefore You RefinanceTips and Tricks for a Better RefinanceThe Refinance ProcessAbout RefinancingBefore getting started, here are some basics you should know.What is Refinancing?Refinancing is when you pay off your old loan with a new loan with new, ideally better, terms. Refinancing is typically the only way to:Shorten or lengthen your loan termAdd or remove a co-borrowerGet a more favorable annual percentage rate (APR) when market rates drop, your credit improves, or you got a bad deal in the first place (usually because of dealership financing)Millions of American drivers are currently eligible for a lower APR than they’re paying, meaning they could be paying hundreds or thousands less on their car loan, and refinancing is the only way to realize those savings.The Basics of the Refinance ProcessHere’s a quick overview of how refinancing works.Get a preliminary quote to check eligibility.Gather your paperwork.Send applications to multiple possible lenders to find your best offer.Choose the refinance that works for you.Sign the paperwork.Stop paying your old loan (ensure any last payments are made and that your new lender has paid off the old loan).Register the change of lien with the DMV (depending on your location, your new lender may handle this, or when you refinance through Auto Approve, we take care of the paperwork filings)Start paying the new loan (new payments will start 1-3 months after payments on the old loan have stopped)Paperwork BreakdownLet’s take a closer look at the items on your refinance paperwork checklist.Driver's licenseYou will need a government issued ID to confirm your identity. Most people use their driver’s license, but you may be able to use your passport, state ID, green card, or military ID.SSNBefore the details of your refinance are confirmed, any lender you apply to will want to run a credit check. While a preliminary quote for eligibility does not include a hard credit check, when you want to actually get hard offers, you’ll need a hard credit check. Make sure all credit checks are done within a two week period to avoid lowering your credit more than necessary.Proof of addressYou’ll need to provide proof of residence (not a P.O. box) to your new lender so they know where you live and can confirm that they offer loans in your state.Documents that can be used to provide proof of address include:A utility billYour lease, mortgage, or deed (or a recent lease or mortgage statement)A recent pay stubA bank statementA government letter or benefits statementProof of incomeProof of income shows lenders that you’ll be able afford the payments on your new loan.For proof of income, you could provide:Recent pay stubsBank statementsTax returns or W-2 formsIncome documents for Social Security, pension, or retirement incomeA letter from your employer or your employment contractSelf-employed individuals and those with variable income may need to provide multiple documents to confirm income.Car detailsYou’ll need to share the details of your car for any sort of pre-qualification, pre-approval, or formal application. That is, you’ll need to know your car’s:MakeModelYearMileageVIN (vehicle identification number)Proof of insuranceYour lender will almost certainly require you to have car insurance in order to refinance. Depending on the lender, you may be required to have liability coverage plus comprehensive and collision coverage. This is because your vehicle is considered collateral on your loan, so the lender wants to protect their asset.To provide proof of insurance, you could use:Your insurance cardYour policy declarations Any document you have from your insurance that includes your name, vehicle, and coverage datesVehicle registrationYou’ll need to share your up-to-date vehicle registration to confirm your car is registered to you. Your registration will also confirm the vehicle details you shared with your lender. If your registration is expired, you’ll need to renew it before refinancing.Current loan informationLastly, you’ll need to share details of your existing loan with your new lender so they know how much you owe and the details necessary to pay off your old loan when you refinance.Since this is an important part of the refinance process, you’ll likely need multiple documents. These may include:The name of your current lenderYour loan account numberYour current monthly payment amountYour remaining loan termAnd the current payoff amountYour new lender may also want a copy of a recent loan statement and/or a payoff letter from your current lender (outlining the payoff quote).Note that the current payoff amount is not the same as the total remaining owed on the loan: the payoff amount may reflect interest and fees. Any amounts owed when paying off the loan early will typically be outlined in your initial agreement. It’s important to check for any added early payoff fees listed in your current loan agreement before you refinance—you want to make sure the benefits of your refinance outweigh these costs.Ready to refinance the right way?That’s all the paperwork you strictly need to refinance your car. Read on for more expert intel on how to get a better rate, or jump right into refinancing with Auto Approve.Get a quote.Before You RefinanceCheck your creditTake steps to improve your creditGet multiple quotesRead the fine printHere are four things you should do before refinancing.Check your creditBefore you even start the process, get a copy of your credit report to ensure its accuracy and check your current credit score. If your credit score has gone down since you initially got financing, you’ll have a harder time getting a better rate.Take steps to improve your creditIf you know you want to refinance in the not-too-distant future, get your credit and financial picture in tip-top shape before lenders start looking into you.This can include:Reducing your debt-to-income ratio by paying down debtRequesting a higher credit limit on a card to lower your utilization ratioRequesting anything inaccurate be removed from your credit reportMaintaining a good track record of paying bills on timeWaiting out any old credit checks—credit checks usually stay on your credit report for 1 year, then stop affecting your score entirely in 2 years, so if you’re close to either of those marks, you may want to wait to apply to refinanceGet multiple quotesBefore you make any decisions on your refinance, be sure to shop around. You should plan to apply to at least 3-5 lenders to make sure you find your best offer. Just make sure all credit checks are done within a two week timeframe—as long as they all happen in the same 14 days, it’ll only count as one credit check.To make this process easier, you can use a lender network, like Auto Approve’s network of 50+ trusted lenders. When you refinance with Auto Approve, you work with one of our trusted advisors to identify the best lenders for your unique financial picture, then we do the paperwork for you, with no markups on your rate.Read the fine printBefore selecting your refinance and signing on the dotted line, make sure you’ve reviewed not just your new APR (which includes fees as well as your interest rate) but the details of your old loan contract to make sure you know any fees you’ll be on the hook for when paying off the loan early. Tips and Tricks for a Better RefinanceTime your refinance based on your loanTime your refinance based on your creditBe selectiveWork with the experts1. Time your refinance based on your loanThe sweet spot for refinancing a loan is when you’ve had the loan for at least 6 months to a year, and still have at least 2 years left on the loan. That’s because you want your credit to have recovered from the last credit check (and most lenders won’t refinance earlier than that), but you also don’t want to have already paid a ton of interest on the existing loan. The longer you’ve been paying your current loan, the less a refinance can help you save money (though it can still let you add or remove a co-borrower or secure a lower monthly payment in a pinch).2. Time your refinance based on your creditAs discussed, the better your credit, the better your rate. If you’ve just had a hard credit check, or you know you need a credit check in the near future for a major purchase, you may want to hold off on refinancing—either until your credit recovers or to avoid a ding to your credit before something important.3. Be selectiveSometimes drivers think it might be easier to just stick with their dealership financing or refinance with the same lender, but if you do that, you’ll end up paying more than you have to. Take your time and check multiple options to ensure you get your best deal so you can pay less (and keep more money in your pocket for the things that really matter!).4. Work with the expertsWhile all these tips can help you lock in a great refinance, the fastest, easiest way to refinance your car and find your best rate is by refinancing with the help of a team of experts.Refinance with Auto Approve and our trusted advisors will help you gather the right documents, find your best refinance options, and handle the paperwork.Now You’re Ready to Start the Refinance ProcessGot your paperwork in order? Then you’re already well on your way to a lower car payment, lower APR, or both!Get started with a free, no-commitment quote today.Get my rate.

Thinking about refinancing your vehicle loan and want to know all the tips and tricks to make sure you get the best deal? Here’s the tl;dr version. Time the refinance right for eligibility and a better dealGet your paperwork in order before applyingShop around for lendersApply to at least 3-5 lenders, making sure to submit all applications in the same two week window to avoid taking a bigger than necessary credit dipChoose your best offer, taking into consider APR (annual percentage rate), any fees or penalties, and repayment periodsOr, you can make it easy by using a company like Auto Approve. In short: Refinancing your car loan is a great way to get a better deal on your car loan, and using a company that specializes in car loan refinance is the best way to do it.About usAt Auto Approve, our refinance experts can help you get a preliminary quote, guide you through the process, connect your application with 50+ trusted lenders, help you read the fine print to find your best deal, then do the paperwork for you—all at no extra cost to you.Millions of American drivers are eligible for a lower car payment, all they need is to find the right refinance. Find out if you’re one of them and get a quote for how much you could save in just 60 seconds—all for free, no commitment or hard credit check required.Get your quote now.Read on for a more detailed look at the refinance process, eligibility, and the best way to refinance a car loan.The Best Way to Refinance A Car Loan: Your Ultimate GuideWhen you initially financed your car, you might not have gotten the best rate, especially if you chose to get financing through your dealership. But starting with a bad deal doesn’t mean you have to live with a less-than-great car loan rate. Refinancing your car loan is a great way to get a better car loan APR and better loan terms. So what’s the best way to refinance, and how can you get started?In this article, we’ll cover:What it means to refinance a car loan Why people choose to refinance a carWhere to refinance your car to get the best dealThe best way to refinance a car loan (broken down into steps)What Does It Mean To Refinance A Car Loan?Refinancing a car loan is when you replace your existing loan with a new car loan, ideally with better terms for your unique situation. Why Refinance A Car Loan?In short, refinancing is the only way to change any aspect of your loan terms. You might choose to refinance to:Save money by securing a lower car loan APRChange to a longer or shorter repayment term (paying less monthly or saving overall on interest)Add or remove a cosignerIf you are asking yourself “should I refinance my car loan?”, you can decide if refinancing your car loan is good move by asking yourself the following:Is it possible I can find a lower car loan APR?Am I struggling to make my monthly car payment?If the answer is yes to either of those questions, refinancing your car loan may be a great option. Of course, there are other reasons to refinance, like if you want to add or remove a co-borrower, or if you want to shorten the length of your loan to save overall because you have more cash on hand now or are planning to move or retire and want to finish paying off the loan. However, paying less monthly—whether through rate savings or term changes—is the most common reason people choose to refinance.A Lower Interest RateYou can find a lower car loan APR if any of the following apply to you:You got dealership financing and didn’t negotiate on the fees.Your credit score has improved since your initial financing.The market rate has decreased since your initial financing.Your debt to income ratio has improved since your initial financing. Refinancing is very beneficial when you can find a lower car loan APR. When you reduce your rate, you reduce your monthly payments and save money over the life of your loan.A Different Repayment PlanIf you are having a hard time making your monthly car payments, refinancing can help you change your repayment plan, which can change your monthly payments greatly. Lengthening your repayment period allows you to repay your principal over a longer period of time, making each payment smaller. Note that you will pay more in interest (since you will be paying interest for a longer period of time), but it can be a worthwhile tradeoff if you are having trouble making ends meet every month.Where Should You Refinance Your Car?That will depend on your credit, your vehicle, and the current market rates. There are many financial institutions that will refinance your car loan. Traditional banks, credit unions, and online lenders are all great options. To get the best deal on your refinance, you’ll want to shop around.That’s why the best way to refinance your car loan is to go through a company that specializes in car loan refinance, like Auto Approve. At Auto Approve, we work with a network of banks, credit unions, and lenders across the country, which means our trusted experts can help you shop around and compare your options quickly and easily. If you choose to refinance your loan on your own, you will need to do a lot of research to determine where you should apply. Then, you will need to apply and compare the different terms and rates that are offered to you. When you use Auto Approve, this process is fast and easy. Auto Approve will handle all of the background work for you, so all you have to do is pick your best refinance option.Then, once you find the vehicle refinance loan that is right for you, Auto Approve can make sure that your old loan gets paid off and that all of your paperwork is done correctly. We’ll even handle the DMV paperwork for you. Worth noting: You can refinance your car loan through a dealership, but that is typically the most expensive option. And, while you may be able to refinance with your existing lender, that is similarly unlikely to get you a great deal.The Best Way To Refinance A Car LoanIf car loan refinance sounds like a good option for you, it’s easy to get started.Step 1: Make Sure You Qualify.There aren’t a lot of qualifications when it comes to refinancing, but eligibility may depend on:How old your car isHow many miles your car has on itHow much money and time is left on your existing loanGenerally, most lenders won’t approve a refinance at the very beginning or end of a loan—you’ll want to have had the loan for at least 6 months and ideally have at least two years left on the loan, so timing does matter.If you aren’t sure if you qualify for refinancing, Auto Approve can help! Our agents can help you determine if you are eligible for refinancing (and find out how much money you could be saving).Step 2: Prepare Your Finances.A little preparation can go a long way when it comes to refinancing. Car loan refinancing is most beneficial when your credit score and your finances are in tip top shape. Here are a few things you could do to ensure that your score is at its best:Commit to making full, on-time payments.Request a copy of your credit report and review it for any errors.Request higher credit limits.Avoid applying for any other lines of credit while you are in the process of refinancing.When you feel like your finances are in order, gather your paperwork. You’ll want to have the following documents ready to go:Your driver's licenseYour SSNProof of addressYour car’s make, model, year, mileage, and VINCurrent proof of insuranceCurrent vehicle registrationPay stubs or proof of incomeCurrent loan informationFinances out of whack? If you are having trouble with your monthly payments, go through your monthly budget to determine what you can afford to pay. Experts recommend that your monthly transportation expenses (this includes car payments, gas, parking, maintenance, and insurance) does not exceed 20% of your monthly income.Step 3: Do Your Research.If you are refinancing on your own, you should try to do as much research as you can. Talk to friends and family to see if they can recommend a lender. Go online and read reviews to get a sense of how competitive different lenders’ rates are and see how their customer service stacks up. You should aim to apply with 3-5 lenders, so you’ll likely want to research at least 10 options. Or, if you use Auto Approve, we’ll handle this step for you and identify the best lenders in our network for your unique financial picture. Step 4: Apply. When you have narrowed your list down, it’s time to apply. Send out all of your applications in a two week timeframe: the credit bureaus give you two weeks where all hard inquiries will count as one hit on your credit score. When you use Auto Approve, we quickly handle all of your applications for you so you don’t need to worry about the two week timeframe.Step 5: Choose Your New Lender (And Start Saving!).When your offers come in, be sure to compare all terms. Check and compare the following:The car loan APRThe repayment periodThe assorted feesThe prepayment penaltiesOnce you determine the best car loan for you, all you have to do is sign and save. At Auto Approve, we handle the paperwork for you and ensure that your previous loan gets paid off. And that’s it! Auto Approve makes refinancing your car loan as easy as possible.Refinancing Your Car Loan With Auto Approve Is The Best (And Easiest!) Way To Refinance.The sooner you begin the refinance process, the sooner you can start saving money. Get started with your free quote now.

Figuring out what vehicle you can afford involves a few different factors.Here's a quick way to figure out your maximum monthly car payment.Your total transportation costs (including gas, parking, insurance, maintenance, and car payment) should total no more than 20% of your monthly income.If you already have a vehicle, you should be able to get a good idea of what you might need to budget for gas, insurance, and so on in a typical month. If not, you can either ask around, or do a little research on average current prices for common costs in your area. From there, you can figure out how much you can afford to pay for your monthly car payment.Then, you’ll want to look at the APRs (annual percentage rate) available to you. A car payment includes more than just the price of the car divided by the number of months in your financing – there are also fees and interest charges to think about.Read on to take a more detailed look at the factors that go into how much car you can afford, how to calculate your car payment budget, and how to find the best deal for you.Your Guide To Budgeting For a Car Payment When you decide the time is right to buy a new car, it’s easy to get carried away. With so many makes, models, and exciting new features available, you might start to feel like a kid in a candy store. But there’s one factor that can jam the brakes pretty quickly on your big hopes and dreams: your budget.Keeping your budget in mind is incredibly important when deciding what car is right for you. But how do you know how much you can actually afford? In this guide, you’ll learn:How much car you can affordWhat lenders look for when determining your APRHow to get the best price when you want to buy a car1. How Much Car Can I Afford?When determining how much car you can afford you need to carefully consult your budget. That means all of your incoming money and all of your outgoing money. There is a general rule that you should not spend more than 20% of your monthly income on transportation expenses.That may sound pretty cut and dry, but that 20% of your income doesn’t mean that you can spend 20% on your car payment alone. That number includes:GasParkingMaintenanceInsuranceOther car related expensesWhile it’s hard to predict every expense, you should have a rough idea of how much gas you go through, how much your insurance will be, and whatever other expenses you may have. If you have a monthly income (take home income, not your salaried amount) that is $4,000, your monthly car expenses should not exceed $800. If you spend $100 on gas, $100 on insurance, and $100 on other expenses, your monthly car payment should not exceed $500.Your car payment will depend on three main factors:The price of the car. The less expensive your car is, the less your monthly payments will be. This price is dependent on the make, model, trim level, and other features you may want in your car. The car loan APR you are offered. The car loan APR you are offered will be based on your credit score, the market rates, and other factors.Your repayment period. The shorter your repayment period is, the higher your monthly payments will be. But this also means you will end up paying less in interest over the life of the loan.Before you go shopping for a new car you should have a good idea of what type of car payment you can afford. While you can negotiate on the price, the APR, and the repayment period, you want to be sure you do not get in over your head with a car payment that you cannot afford.2. What Do Lenders Look For When Determining APR?Your car loan payments will depend largely on the type of financing you can secure. When applying for a car loan, lenders will look at the 5 Cs of credit: character, capacity, capital, collateral, and conditions.These characteristics help them decide how credit-worthy you are. The car loan APR that you are offered will be based in part on these factors. Together, they paint a picture of how risky your loan is.CharacterYour character refers to your credit history and how well you have managed your debts previously. Lenders will look at your credit report to determine whether or not they think you are an eligible candidate for a loan with a good APR. The best thing you can do before applying for a car loan is work to improve your credit score.CapacityCapacity refers to your ability to repay the loan. Lenders look specifically at your debt to income ratio. You can calculate your debt to income ratio by adding up your monthly debt payments and dividing that by your pre tax income. Multiply that by 100 to get a percentage. Experts recommend that this number be below 36% for homeowners and below 20% for renters. This number tells lenders whether or not you have the means to repay the loan you want.CapitalCapital refers to the amount of money you will actually put down as an investment on your loan (a down payment). The larger your down payment is, the more favorable your terms will be.CollateralYour collateral is what you will lose should you fail to repay your loan. Your new car is the collateral for a new car loan. When there is collateral the loan is referred to as a secured loan, which is less risky for a bank than an unsecured loan. Secured loans tend to have more favorable terms.ConditionsConditions refer to any other factors that may affect your loan, such as the prevailing market rates.That said, dealerships also mark up their rates using something called dealer’s reserve, even for buyers with good credit. If you got, or are thinking about getting, your financing directly from your dealership, you may want to consider refinancing after 6 months to a year to get the lower rate you most likely qualify for.3. How Do I Find The Best Price For A Car?If you know how much you can safely afford for a car payment every month, you can roughly estimate the market price of the type of car you can afford. But the lower you can get this number, the better off you will be every month when making your payments.When it’s time to buy a car, follow our steps below to ensure you get the best deal possible:ResearchStay flexibleLook for dealsGet pre-approvedAvoid add-onsNegotiateStep 1: ResearchDoing your research is essential when it comes to buying a car. Not only do you need to figure out how much you can truly afford to spend every month, but you need to figure out what a fair price is for the car you are interested in. Checking Kelley Blue Book and Edmunds can give you an idea of what a fair price is for the car you are interested in.Step 2: Be FlexibleWhile we all have our dream cars and dream features, it’s important to be flexible when shopping around. This is especially important in today’s car market where there are shortages and increased price tags. Having an open mind will help you find a car you love for the right price. Step 3: Look For DealsYou should look around at a number of different dealers and compare pricing, and then compare those to online dealers. There are a lot of online dealers, including:AutotraderCars.comCarsDirectCarvanaEnterpriseTrueCarVroomIf nothing else, having other numbers for comparison can help you negotiate at a dealer.Step 4: Get Pre-ApprovedGetting pre-approved for your car loan before you even set foot in a dealership is a must. It will give you more leverage when you visit the dealership and will also help ensure that you stay within your budget. You can also shop around ahead of time for a reasonable rate, which is always a good idea.Step 5. Avoid The Add-OnsIt’s easy to get talked into add-ons and features that will drive up the price of your car significantly. Anti-theft devices, window tinting, key protection, paint and fabric protection, all-season floor mats, and wheel locks are just some of the features your dealer may offer you. While some of these may be of interest to you, keep in mind that they will increase your car’s total price by thousands of dollars. It’s a good idea to consider which features are actually worth paying extra, and which are less important. When you see the price tag, you can determine if the extra money makes sense. Step 6. Negotiate What You CanWhen you are buying a car, there are a number of places where you can negotiate to get the best terms possible. First, you should always negotiate the market price. If you can prove that you can find the car at a lower price elsewhere, you will be more likely to get a good deal. You should always be willing to walk away from a bad deal, so don’t let your emotions get the best of you.Additionally, many drivers don’t realize that you can negotiate on any fees that might be tacked onto your car purchase. There are a number of added fees you may be expected to pay when you buy a car. These may include:Documentation feeAdvertising feeShipping feeDealer feeThese are easy places for the dealership to make money or adjust down to make a deal with you, so be sure to negotiate on fees.So, How Much Car Can You Afford?Now you know how to determine how much car you can afford—and how to get the best deal possible on the car you select.Buying a car is a big deal, but being prepared can help ensure that you get a good deal. Doing your research, getting preapproved, and negotiating your car’s price are just a few small steps that can save you thousands of dollars.And, if your financial picture changes and you find yourself struggling to cover the monthly payments for your car, or you think your dealership didn’t give you a good rate, consider refinancing! Refinancing can help you quickly and easily lower your car payment. By refinancing to a lower car loan APR or changing your repayment period, you can reduce your car loan payments by hundreds of dollars per month. Get started with Auto Approve today to find out just how much you could be saving every month! Getting a quote is free, fast, and doesn’t require a commitment or hard credit pull.Get your quote now!

Here’s the short answer: You should change your motor oil according to manufacturer recommendations, usually found in your vehicle’s owner’s manual. While the old standard was every 3,000 miles or every 3 to 6 months, newer cars using fully synthetic oil or a synthetic blend can often make it much further before a change is needed — roughly between 5,000 and 10,000 miles.That said, how often you need to change the oil in your specific vehicle will depend on make, model, oil type used, and your usage of the vehicle. Vehicles that get heavier usage, especially in environments that have a lot of dust or dirt or in extreme temperatures, will typically need more frequent changes. Vehicles that get little usage will still need an annual change because the oil breaks down with time regardless of use.Checking your oil regularly is the best way to stay on top of whether your oil needs changing. That way, you’ll know when it’s time for an oil change before you start seeing warning lights on your dashboard or hearing strange engine noises.Want the detailed version? Read on to get a better understanding of the what, how, and why of oil changes.Oil Changes: Your Complete GuideAt Auto Approve, we’re all about making smart decisions that make sense for your life and your wallet, especially when it comes to saving money on your vehicle. When it comes to oil changes, a little maintenance can go a long way toward keeping your vehicle running longer and preventing more extensive maintenance costs from cropping up down the line.In this guide, you’ll find the answers to these oil change FAQs:What is an oil change, and why is it necessary?How often do I really need to change my oil?What happens if you don’t change your oil?How much should an oil change cost?Why do mechanics say you should change your oil every 3,000 miles?Can I change my own oil?Tips for oil changes and related vehicle maintenanceWhat is an oil change, and why is it necessary?Here’s what you need to know.What motor oil does in a vehicleMotor oil lubricates the inside of your engine, keeping your engine clean, cooling it down, preventing rust and corrosion, and reducing friction and wear and tear. It’s essential to a properly functioning engine.Oil change, definedWith use and time, motor oil starts to break down and collect dirt and grime from the engine. An oil change is when you (or your mechanic) remove the old oil from the engine and replace it with new oil to keep the engine running properly. Types of motor oilThere are four key kinds of motor oil:Conventional oilFully synthetic oilSynthetic blendHigh mileage oilConventional oil is the older style or petroleum-based oil (made from crude oil) that needs more frequent changes. It’s primarily used for older cars that get regular maintenance.Full synthetic motor oil is a chemical-based lubricant manufactured for the express purpose of lubricating engines. Synthetic oil typically stays cooler, works better in more extreme environments, and takes longer to break down. The introduction of synthetic oil is why manufacturer recommendations have shifted as to how often you need to change your oil. It tends to be more expensive than conventional oil but is the preferred choice for newer vehicles.A synthetic blend is a mix of synthetic and conventional motor oil. It offers better performance than conventional oil at a lower price point than fully synthetic oil, so is a popular choice.High mileage oil is typically either a blend or full synthetic motor oil. It’s designed to help engines that have over 75,000 miles on them keep running. High mileage oil is typically more viscous and contains additives to help prevent buildup, rust, corrosion, and metal-to-metal contact. It tends to be the most expensive of all the oil options, but if you have a vehicle with a lot of miles on it you want to keep using, the extra $20 or $30 is much less expensive than engine repairs or replacement should something go awry.Why oil changes matterThe tl;dr version is: regular oil changes keep your engine running and prevent engine damage. Pretty important!How often do I really need to change my oil?That depends on several factors, namely: vehicle, usage, and oil type.Vehicle:Newer vehicles built to run on synthetic oil tend to need less frequent oil changes. As vehicles get older, oil changes become more important, and older vehicles may be more likely to need more frequent oil changes, especially if they’ve been running on conventional oil.Usage:Any of the following can result in more rapid deterioration of your motor oil, especially when done on a regular basis:Extreme heatExtreme coldExtreme humidityDriving in a dusty, muddy, or dirty environmentRepeated short trips (under 5 minutes at a time, because starting up your engine causes more wear and tear)Long periods spent idling (including in stop-and-go traffic)Hauling something heavy or towing a trailerConversely, not driving your car for long stretches can also result in getting lower mileage out of your oil because time also breaks down motor oil. Even if you haven’t driven many miles at all, if a year has passed since your last oil change, you’ll likely need to change your oil to keep your motor running properly.Why do mechanics say you should change your oil every 3,000 miles?You’ll still hear the 3,000 mile rule of thumb at many mechanic shops because it was the gold standard for many years as it is the correct mileage for an oil change if you’re using conventional, petroleum-based oil. Synthetic oil has become more commonly used since its introduction in the mid-1970s, but not every shop has updated their standard to reflect its prevalence.How to check your motor oilPark on level ground.Turn off your engine and let it cool for at least 5-10 minutes.Open your hood.Pull out and use a rag or paper towel to wipe off your dipstick (most have a yellow or orange handle).Reinsert it fully, then pull it out again.Use the markings on the dipstick to check your oil levels.Examine the oil: it should be light or golden brown and free of particulates. If the oil is dark black, gritty, or tar-like, you are past due for an oil change. If it looks milky, foamy, or contains bits of metal, these are signs of more serious issues, and you need to get the vehicle assessed ASAP.What happens if you don’t change your oil?The short answer is, if you don’t change your oil, eventually your engine will stop working properly, and in worst case scenarios, may break down entirely and need replacement. Motor oil is essentially for your vehicle’s functioning and keeps metal parts in your engine from rubbing together and breaking. Letting your engine break down by failing to do routine oil changes can also void your warranty.Warning signs that it’s time to change your motor oilHopefully, you’ll change your oil as part of your vehicle’s regular maintenance, but if you see (or hear) any of these signs, it’s probably past time for an oil change:Your oil change light comes onYour check engine light comes onYour dipstick check shows low oil levels or darker than usual oilYou aren’t getting as good mileage as usualYou smell burning oilYou hear knocking, ticking, clicking, or grinding from your engineLooking to save money? Change your oil before it becomes a must instead of a should and you’ll extend the life of your vehicle.Looking for another way to keep more money in your pocket? Consider refinancing with Auto Approve’s network of 50+ trusted lenders. Millions of drivers in America are eligible to save simply by refinancing. Find out if you’re one of them in less than a minute, no commitment or hard credit pull required.Get your free quote now.Can I change my own motor oil?It is possible to change your own motor oil, though it can be a little challenging if you’re not well acquainted with car maintenance. You’ll need to use your owner’s manual to guide you. Remember to check:Oil typeOil quantityOil filter sizeOil pan and plug locationChanging your own motor oil can save you money, as long as you feel confident in your ability to do it correctly. Be sure to do your research before diving in!Tips for oil changes and related maintenanceHere are a few more tips for keeping your ducks in a row when it comes to your motor oil.Keep good records: Keeping maintenance records will help you know when you haven’t changed your oil in a while, and can boost your car’s resale value down the lineKnow your dashboard lights: Spend a little time with your owner’s manual so you know what different alerts mean if and when they come up.Know your habits: Check your oil more often when using the vehicle in more extreme conditions or in more taxing ways.Strike a balance: Time your oil changes well and you should get more out of your vehicle over time. Changing too often is unnecessary, but stretching your oil as far as it can go can do more damage than it’s worth.Lubricate well: Spring for synthetic oil if you can, it makes a difference!That’s everything you need to know about oil changesKeeping your motor running properly is essential vehicle maintenance. Know when to change your oil and then make sure you do it and your car will reword you.Looking to make a change on your auto loan? Auto Approve can help you find your best available rate and start saving on your car payment in a snap.Find out how much you could save now.