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If you're thinking about refinancing your vehicle, you might come across the term “LTV” or “loan-to-value”. The loan to value ratio is one of the most important parts of a new car loan – or refinance. After all, the refinance process is basically applying for a new auto loan with another lender. You’re taking out a brand new car loan for the same vehicle, paying off your existing loan with the new loan, and lowering or stopping your existing monthly payment. People do this to get a more favorable interest rate or to lower how much they’re paying per month (or both). So when you think about refinancing, you’re really thinking about getting a new loan.All that out of the way, let’s talk about LTV.Loan-to-value is a concept many people don't grasp, but understanding your LTV and how it affects your loan or refinance is crucial if you want to avoid any surprises when getting into debt for your new, or not so new, car. And the same applies for your truck, SUV, or, yes – even motorcycle.So, what exactly is a loan to value on a car? Lucky for you, we’re here to help.Here are all your answers to the most common questions about Loan-to-Value on a car loan.What is a loan-to-value (LTV) ratio in an auto loan?The LTV is, essentially, the percentage of your car's value that you are borrowing from a lender. For example, if your loan is $30,000 and your car is worth $30,000, your LTV is 100%.In short, the loan-to-value ratio, or LTV, is the monetary value of your loan divided by what’s called the “actual cash value,” or ACV, of your car. So you’ll usually see your loan-to-value listed as a percentage. The higher the percentage goes, the more risk there is for you as an individual and for your lender, so a lower LTV is generally better than a high one.How do you calculate the loan to value on a car?To calculate your loan-to-value ratio (LTV), divide the total dollar value of your loan by the ACV – again, that’s the ‘actual cash value’ – of your vehicle. So, hypothetically, if you owed $16,000 on a car that is valued at $20,000 by the dealer, your loan-to-value ratio would be 80%.16,000 ← owed on loan÷ 20,000 ← car value__________0.80 ← loan to value ratioThe tricky part, however, is figuring out your car’s actual cash value in order to do that math. Many insurers use a proprietary formula when calculating a vehicle’s ACV, which makes things a little tougher for the consumer. But, the good news is, you can get a ballpark range fairly easily.Figuring out your vehicle’s ACVFirst, your ACV will almost certainly be less than what you paid. For the most part, a car’s value drops significantly the moment someone drives it off the lot and it goes from new to used. But after that initial drop-off, the value depreciates much slower as the vehicle gets used and experiences regular wear and tear.The basic formula for computing actual cash value is to subtract depreciation from replacement cost, but that is pretty complicated. The easiest way to find out your ACV for the purposes of calculating your approximate LTV? Simply research your car's make and model and look for cars with similar mileage and histories. To do this, you can use the Kelly Blue Book, search for cars like yours for sale online, or even visit a local dealership and ask their thoughts.On the fence about whether or not to refinance your car?Pro tip: Try looking up the Kelly Blue Book or NADA guides for your exact model of vehicle, then compare it with what you owe on the loan. If this number seems high, it might be time to refinance!I’m interested in refinancingWhat is a good loan to value ratio for a car?In general, you want a low LTV. When refinancing a home, you want at least 20% equity in the home, so an 80% LTV or lower. Vehicles are a little trickier, since they depreciate in value over time. While an LTV less than 80% is ideal, it’s not uncommon to have an LTV around 100% on your existing loan when it comes to car loans. When getting a new loan through refinancing, a high LTV won’t necessarily disqualify you, but depending on the lender, you may be asked to put down a down payment to lower your LTV (and we’ll get into why in just a second). All that said, the lower the LTV, the better the interest rate you’re likely to get. So a lower LTV is always better for you as the consumer.Does your loan-to-value ratio affect your interest rate? Yes, it certainly can. This is because lenders take your loan to value ratio into account when deciding how much they are willing to lend you and at what rate. Your total amount owed on any type of loan, including car loans and mortgages, should be lower than the market value of the vehicle or home you want to finance. In general, a higher loan-to-value ratio translates to a higher interest rate.How does a down payment affect my auto loan?With some loans, the lender will request a down payment when you refinance. This down payment is used to reduce the loan to value ratio for your new loan. In other cases, even if the lender doesn’t ask, if you have the financial flexibility, you may want to add or increase a downpayment in order to help you save more money and pay less – both monthly and in the long run.This is all done because your LTV percent can affect both the interest rate available to you and overall lender options. In fact, some lenders have an LTV ceiling, meaning they won’t lend if the LTV is above a certain percent. Again, the higher the loan-to-value, the more risk the lender has to take on (and you, too!), so it makes sense that a better LTV would give you more and better options for your new loan. For many loans, increasing the amount of your down payment will likely decrease the total cost of borrowing money for that purchase and could even save you some cash in monthly payments!And that’s everything you need to know about your car’s loan-to-value.Now you know what a loan to value is on a car and why it matters. We hope you found this article enlightening. While we have you, if you’re researching LTVs because you’ve been thinking about refinancing your vehicle loan, we can help! The team here at Auto Approve will work with you one-on-one through every step in the process – whether that means getting prequalified online or finding an offer tailored just for you. Get started today by filling out our simple form to get a quote in minutes.GET A QUOTE IN 60 SECONDS

The refinancing process can lower your monthly payments and help you get out of debt faster. The answer to the question "should I refinance my car now?" depends on your situation, but if you're thinking about it, here are some things to consider:Is your auto loan term nearing its end?Are you struggling with high monthly payments?Have interest rates gone down?Has your credit score gone up?Do you want a lower interest rate?If the answer to any of these questions is yes, now may be the time to refinance your car. Let’s take a look at all of the factors that you’ll want to consider when deciding when to refinance your car loan.Your Credit ScoreYour credit history is one of the biggest factors in being able to refinance with most lenders. If you have good enough credit, then refinancing your car could save you money.Refinancing can be a great option if you have improved your credit and want lower monthly payments or to get a longer term on your loan. Better credit can also qualify you for a lower rate than you initially received so that you can pay less overall, regardless of whether or not you want a lower monthly payment.The only thing worth noting when it comes to your credit score is that you’ll want to avoid refinancing multiple times, as doing so could hurt your score, and rates usually go up with each refinance. Your Cash FlowIf your income has gone down or you want more money in your pocket for added expenses, refinancing your auto loan could make sense for you. Doing so can lower your monthly payments and help save some cash.Refinancing offers tons of potential savings and can be helpful for people who have limited cash flow. For example, if you’re unemployed and need money in your pocket right away, refinancing can lower your monthly payments and even give you the option to take a few months off from making a payment.Before refinancing your car loan, make sure you refinance for the best possible price. Shop around and compare offers before signing any paperwork to make sure you’re saving as much as possible. Unlike the competition, at Auto Approve, we never mark up the rate the bank offers you, so we pass maximum savings on to you. Your Existing LoanWhen thinking about whether or not to refinance your car loan, it is important to know the current interest rate and term of your loan. You should consider the amount of time left on your loan and any prepayment penalties.Prepayment penaltiesPrepayment penalties are fees your lender charges you for paying off the loan before it is due. Watch out! Some lenders will not refinance loans that have prepayment penalties attached. That said, even if your current loan has a penalty attached, it may still be worth it for you to refinance. In some cases, you may be able to save more by refinancing than the cost of the penalty. This is especially true if you got a particularly bad rate on your existing loan (which frequently happens when you buy a new car directly from the dealer). Time remainingIf you have several years left on your current auto loan at an unfavorable rate or your existing loan has high fees, refinancing may be the right decision. After all, refinancing your car loan can be a great way to save money on interest and get lower monthly payments.If you refinance your loan to a longer term, you’ll likely be able to lower your monthly payments – but you could end up paying more in interest. On the flip side, if you can refinance at a lower interest rate and at a similar or even shorter loan term, you’ll be able to save money in the long run. (That’s one of the things that makes refinancing so great!)Eligibility For A New LoanHere’s a good question: What makes you eligible to refinance your car? Well, it varies based on the lender, but eligibility can depend on: how old your car ishow many miles you have on ithow much money is left on your loanand other factors If you’re not sure whether you’re eligible to refinance, don’t worry – we can help! Talk to one of our knowledgeable and friendly Auto Approve agents or use our handy online quote form to find out if your vehicle loan qualifies and how much you might be able to save in a jiffy.Interest RatesWith all that out of the way, one of the most important factors you should consider when deciding when you should refinance your car is the broader picture of interest rates.When it comes to interest rates, there’s no time like the present to refinance your car loan. There are a lot of reasons why refinance rates may be lower now. Interest rates have been historically low for years but hit an exceptional low during the COVID-19 pandemic. As of today, they’ve only increased slightly since 2020. However, it’s possible that interest rates may go up in 2022. If that happens, then refinancing may become less helpful for those looking to put a little money back in their pocket with a lower payment, better rate, or both. With that in mind, if you’re eligible, it’s a great time to refinance your automobile right now.And that’s everything you need to know about choosing when to refinance your car loan.Many things go into the decision to refinance your loan, but these tips should help you know what to look for. After reading these tips, it should be clear whether refinancing may be the right decision for you right now – and if now's the time, give Auto Approve a try.GET A QUOTE IN 60 SECONDS

If you're like most people these days, you may wondering how you can stretch your paycheck a little more this month. With the cost of everything rising left and right, whether you're trying to make ends meet, looking to save for a big purchase, or simply looking for more disposable income, many of us are looking for ways to save a few dollars.Here's the good news. Refinancing your truck may be a quick and easy way to reduce your monthly payments and give your wallet some much needed breathing room. So what does it mean to refinance a loan exactly? To put it simply, refinancing is paying off your existing loan with a new loan that ideally has better terms. Most people are overpaying every month for their truck loan, and refinancing is a straightforward way to fix that.So when exactly is the best time to refinance your truck? Consider the following factors to determine the best time for refinancing.Your personal finances, including your credit score, income, and future cash flowYour current loan’s terms, including prepayment penalties and time remainingCurrent interest ratesLet’s take a closer look.Here are the major factors to consider when deciding when to refinance a truck.Your personal financesTrying to determine when is a good time to refinance a car loan or truck loan is going to vary from individual to individual. Your personal finances will be a huge factor as to when you should consider refinancing. It is important to think about your credit score, your income, and your cash flow when making this decision.Your credit scoreYou might be wondering, “what credit score do I need to refinance my car or truck?” The truth is there is no one magic number that will make refinancing make sense. It is important instead to look at how your credit score has changed since you last financed your truck. To put it plainly, has your credit score increased or decreased? If it has increased, even only slightly, you may qualify for a lower interest rate. This leads to more savings every month and more money in your pocket. If your credit score has gone down, this might not be the best time to consider a vehicle refinance.A good credit score is one of the most important factors in securing a good interest rate, so keep a close eye on your score to determine the best time to refinance.Your incomeHas your income decreased since your original financing? So many people have experienced decreased earnings in the past few years and are in need of extra cash to meet their monthly obligations. If your income has decreased recently, refinancing is a great way to reduce your monthly payments and help bridge the gap between earnings and expenses.Your cash flowWhat are your plans for the future, and do you have the cash flow to help you get there? Maybe your family is expanding and you could use the extra cash, or you finally want to pull the trigger on that bathroom remodel you’ve been talking about for years. Refinancing your truck might be the answer to your cash flow question. You may be eligible to refinance and borrow additional money based on your truck’s value. You can also use this money to cover other expenses, such as paying off credit card bills or catching up on medical bills. It is important to be careful here, however; a truck is a constantly depreciating asset, so you do not want to risk owing more money on your truck than it is worth. Your current loan’s termsIn addition to your personal finances, it is important to look at the current terms of your auto loan to determine whether or not it is the right time to refinance your vehicle. The amount of time you have left in your repayment period will affect whether or not refinancing is worthwhile. In addition, some lenders charge fees should you choose to pay back your loan early. It is important to check these terms and weigh your options.Time remainingHow much time is left on your current loan’s pay period? If refinancing to a lower interest rate results in a similar or shorter payment period with a lower rate, you will certainly reduce your payments and save money overall. But what if refinancing your truck lengthens your payment period? This may lead to lower monthly payments, but the additional payment period means you may be paying more money overall. This decrease in monthly payments may still make sense though, depending on your financial situation. It is important to look at all of your options and do the math to decide whether or not it is a good time to refinance your truck. The experts at Auto Approve can help you compare different options from different lenders to optimize your vehicle refinance.Prepayment penaltiesDoes your current lender have prepayment penalties? Some lenders charge a penalty for paying off early, making it more of a burden to refinance. Prepayment penalties help these companies to offset the lost profits that come as a result of paying off loans early. To find out if your loan has a prepayment penalty, you can look through your contract or contact the lender directly to find out. If you find out there is a penalty associated with paying off your loan early, be sure to sit down and do the math. If the penalties of refinancing your truck are outweighed by the savings, it still might make sense to refinance.While there can be exit and transfer fees associated with refinancing, rest assured that, at Auto Approve, we never markup the price that you pay.Today’s interest ratesInterest rates in 2021 have only increased slightly since 2020’s historically low interest rates. It is hard to predict what 2022 will bring economically, but many experts think that over the next two years the interest rates will likely rise. This means that it will make more sense to refinance your truck sooner rather than later. It is important to take advantage of the historically low interest rates while it is possible to do so. It is important to consider all of these factors when deciding the best time to refinance your truck.Should you refinance your car or truck? Is refinancing a vehicle worth it? As you can see there are many factors that must be taken into account. Ultimately, you want to get the shortest loan term combined with the lowest interest rate to guarantee you are getting the best truck loan possible. At Auto Approve, we advocate to get you the best rates and best deals from leading lenders. Because, at the end of the day, we all just want to keep a little more of our hard earned cash in our pockets.If you're ready to refinance your truck, we can help.GET A QUOTE IN 60 SECONDS

Are refinance rates different from the rates on new car loans other people are getting? It's a worthy question.Everywhere you turn, it seems like people are talking about interest rates. Terms like “historically low” and “all time low” are being tossed around like confetti, and you definitely don’t want to miss out on whatever party is happening (especially if that party is about saving you some cash, right?). But wait – you already have an auto loan, so how can you benefit from all of this? The answer, of course, is refinancing.Let’s take a look at the benefits of vehicle refinancing.When you refinance a car, you start over with a new loan, and your interest rate can change drastically.Is the process of refinancing the same as the process of applying for a new auto loan?Refinancing is simply paying off your existing loan with a new loan. You are essentially just replacing one financing option with another. The new loan will ideally have a better rate or some other favorable features that make it more desirable than the original loan. You will still have to apply for the new loan, you will still be bound to a loan payment schedule, and you will still offer your vehicle as collateral.The Application Process is the SameWhen refinancing your car, you will need to do research and apply to different lenders, just as before. You will have to provide the same documentation as you did the first time. These documents usually include the following:Photo ID. This can be a passport, driver’s license, or other government issued photo identification.Your vehicle’s information. This often includes the bill of sale, VIN number, the make, model, and year of your car.Proof of income and financial history. Lenders want to see that you are actively earning income. The lender will specify what documents they wish to see, but this often includes pay stubs, banking information, credit history, and other financial account information. This will verify that you are a strong candidate for a new loan and that you will be reliable with your repayment.Proof of residence. Lenders need to verify where you actually live. This can be a mortgage statement, lease agreement, or utility bill. PO boxes are not acceptable as proof of residence.Proof of insurance. Lenders will want to know that there is state-required insurance on the vehicle.Think of these papers as your resume or online dating profile. You want to look as desirable as possible to the lenders you are pursuing. The more desirable you are, the more worthwhile refinancing will be.Just like with your original application, you want to compare the different offers and see who offers the best terms overall. At Auto Approve, we'll help you compare all of your offers to ensure that you are getting the best deal possible.The Loan Terms May DifferAfter refinancing, you will still have an auto loan that you will need to make regular, scheduled payments on. Your payment schedule may change, however. Your schedule may be shorter, so that you can pay off your car faster. Your schedule may lengthen, making your monthly payments lower. Or, your payment schedule may stay the same. And your vehicle will ultimately serve as collateral for your loan, as it did with your original loan.The main benefit of vehicle refinancing? The interest rate.If you are simply changing from one loan to another, why bother refinancing a car? Why bother with that whole lengthy application process, the approval, and the possibility of rejection? The biggest, most important reason of course – money. You can save a boatload of money by changing your interest rate. The lower your interest rate, the less you pay in interest (duh) and the more money in your pocket at the end of each month.There are many reasons your interest rate can change when you choose to refinance your vehicle. These reasons have to do with your personal credit, income, and job status, as well as the economy in general.Increasing your credit score can result in a lower interest rateYour credit score is the single biggest factor in your refinance rate. If your credit score has increased since your original loan, you may be eligible for a lower rate. The following factors can help contribute to a higher credit score:History of on time paymentsLow balances on credit cardsOlder credit accounts that are in good standingHaving a good mix of credit card and loan accountsA small amount of new credit inquiresIf you have a history of late payments or carry high credit balances, these can negatively affect your credit score. If you have made a lot of new credit inquiries recently, this can also lower your credit score, so you will be better off waiting a year or so to apply for car refinancing.It is generally recommended that you pull your credit report ahead of time and review it for any inconsistencies. It is free to pull your credit report from the three major agencies once per year without it negatively affecting your credit score. These agencies are Equifax, Experian, and TransUnion. If you come across anything that is incorrect, you can dispute it with the credit bureau and petition to have it removed from your report. An increase to your income or change in job can result in a lower interest rateIf your income has increased since your original loan, lenders may view you as being more financially stable and therefore offer you a lower interest rate. But the number on your paycheck isn’t the only factor that matters. Having a stable, salaried position may secure you a better rate than being self-employed or working as a freelance employee. These will all help you become more attractive for a vehicle refinance. A decrease in your debts can result in a lower interest rateIf you have less debt than you did when you originally got your loan, lenders may view you as being more financially stable. Decreasing the amount of money you owe in general can lead to lower interest rates.The current economy is offering lower interest ratesRefinance rates depend in part on how healthy the economy is in general. Big banks adjust their target interest rates to respond to the economic climate. If the economy is strong, they tend to increase interest rates. If the economy is a bit sluggish, they lower interest rates to encourage spending. After the tumultuous 2020-2021 economic season, interest rates are currently at historic lows. However, many economists think that as the months go on, the interest rates may start to steadily increase. So, if you are wondering, “When is a good time to refinance a car loan?”, the answer might be right now.And that's everything you need to know about refinance vs. new car ratesAs you can see, there are many complicated factors that make up the interest rates for refinancing. It can feel overwhelming when there are so many different lenders to consider, all of which have different rates and terms to offer. That’s why, at Auto Approve, we work as your advocates, approaching different lenders to help you find the best rate and best terms available. When you refinance with Auto Approve, you can put more money back in your pocket for the things that matter, and we make the process quick and hassle-free – and never mark up your rate.GET A QUOTE IN 60 SECONDS

Thinking about refinancing your SUV? You're in the right place.Refinancing is the process of taking out a new loan to pay off the balance of your existing loan, and there are a number of good reasons you might want to refinance a vehicle. Perhaps your financial situation has changed and you need a little more money every month, a little more breathing room in your wallet. Vehicle refinancing can help lower your monthly payments, either by lowering your interest rate, extending your payment timeline, or both. Maybe you have a bit of extra money and you want to pay off your SUV at a faster rate and be done with the loan entirely. Refinancing can lower your interest rate and decrease your payment timeline, allowing you to pay off your loan faster and, ultimately, saving you money.Here are some factors to consider when deciding if now is the best time to refinance a car or SUV.How to know if the time is right for your to refinance an SUVThere are many things to consider when it comes to refinancing a car. If any of the following apply to you, it might be a good time to refinance your vehicle.You didn’t get the best deal on your SUV in the first place due to your income or credit scoreMaybe your credit score had just taken a hit from some inquiries or missed payments. Maybe you had a tough couple months at work and your income wasn’t as high as the bank would have liked. Regardless, the bank didn’t view you as a very desirable candidate, and you were stuck with a rather high interest rate.Since then, your credit has improved. You have checked your credit reports on the three credit bureaus (which you can do for free once a year), and everything looks better. Your job is steadier, and your paychecks are a bit bigger. You know that if you went for that loan now, you would get a much better rate. While there is no magic credit score to refinance, you know that you are a much more desirable candidate this time around.If you originally bought your SUV when times were a bit tougher and your situation has since improved, this could be a great time to consider refinancing.You didn’t get the best deal in the first place due to a smooth talking salesmanYou went in to browse and get an idea of what kind of SUV you might be interested in, and before you knew it you were signing on the dotted line. Somehow you agreed to a 7% interest rate when other lenders were offering 5%, and you didn’t even see it coming. Car dealerships notoriously offer higher rates to make more money, and it is common to get caught up in the excitement and agree on the spot.In this case, simply refinancing with an accredited lender can reduce your interest rate, even if your credit score and income have remained the same.Interest rates in general have dropped since you first took out the loan on your vehicleDid you take out your SUV loan years ago when interest rates were high? Big banks tend to adjust interest rates based on how the economy is performing.If the economy is dragging, as we are seeing now, banks will often lower interest rates to encourage more spending. It is important to take advantage of these rates before the economy speeds up and the banks increase rates again. Timing is key when it comes to interest rates and refinancing your vehicle.If you're ready to start the refinancing process today, it's quick and easy to get a quote from Auto Approve. We never mark up rates from our lenders so, with Auto Approve, you know you're getting your best possible rate.Get a quoteYou want to add or remove a borrower to your policyAdding or removing a co-borrower to your loan is a very common reason to refinance, whether the reason is personal or financial.Adding a BorrowerMaybe times are tough right now. Your hours at work got cut and you are struggling to make ends meet. The monthly payments are simply too much to keep up on. Your friend or partner, however, could use a set of wheels, and they have some extra money to help bridge the gap in your payments. Best of all? They have fantastic credit. That's a great reason to consider refinancing your SUV! You can also refinance with a partner who has better credit simply to reduce household bills or help a partner who has worse credit than you by co-signing on their refinanced loan.Whatever your reason, adding your friend or partner to the loan can secure you a better interest rate and reduce your overall payments, since you will be splitting the monthly cost. The lender will consider your joint income and both of your credit scores when determining an interest rate.Removing a BorrowerWhat about removing a co-borrower? Maybe you had a co-borrower on the original loan because your credit wasn’t the best, but you don't really need the help anymore. Or maybe you were in a relationship that has now gone south and you need to separate from that person financially. Either way, refinancing your vehicle is a great way to sever that financial tie.You need the extra breathing room each monthYour finances have changed a bit for whatever reason, and you are having trouble making your monthly payments on everything. You want to take a big trip or are saving up for a big purchase. You simply want more spending money to pamper your family. No matter why you want a little extra wiggle room, refinancing could be the solution.Refinancing can allow you to lengthen your repayment period, which will lower your car loan payments every month. Keep in mind that this often means you will be paying back more money overall for the duration of the loan, unless you are able to drastically reduce your interest rate as well.It’s been at least six months since you originally took out your SUV loanYou need to wait at least 60 to 90 days to be able to apply for refinancing, as it typically takes this long for the title transfer to complete. But waiting six months will allow your credit score to bounce back from any dips that your credit score may have taken when initially securing your loan. First time borrower? Experts suggest waiting a year to refinance to optimize your refinancing options.You have at least two years remaining on your current SUV loanSince most of the interest for a loan is paid in the beginning, the more that is paid off on the loan, the less beneficial refinancing can be. Having at least two years remaining on your loan will help ensure that you will benefit from refinancing your vehicle.How you know the time is not rightWhile it might sound tempting to refinance with the current low interest rates, there are several reasons that it might not be the best time to refinance your SUV. If any of the following apply to you, consider waiting on refinancing your vehicle.Your credit score has decreasedYour credit score is the single most important factor in determining your interest rate. If your score has not increased since your original loan, you will likely not qualify for refinancing. Credit scores can decrease for a number of reasons, such as:Late or missed payments.High credit balances.One of your credit limits decreased.A lot of new credit inquiries.Your credit utilization score has dropped. This ratio is determined by adding up all of your credit card balances and dividing it by your available credit. This number should ideally be 30%Any of these factors can cause your credit score to drop. Request a copy of your credit report and, if you see any inconsistencies, you can report it to the credit bureaus. You need a high credit score for another reasonWhen you apply for refinancing, your credit score will take a hit. There is a fourteen day window allowed by the big three credit bureaus that allows for all credit inquiries in that span to count as one credit hit. But if you need your credit to be in good standing for another reason, say a mortgage application, it is best to hold off. These credit inquiries will affect your credit score for a year, so plan accordingly.The fees outweigh the savingsSome lenders build in prepayment penalties to their contracts. To offset the cost of losing your remaining interest, they build in penalty payments. Read your contract closely to see if you will incur any penalties, and call your lender directly if you are still unsure. Sit down and do the math to determine how much you will save by refinancing a vehicle, and see if that outweighs any penalty fees you might incur.You have an old vehicle or a vehicle with high mileageIf your SUV has very high mileage or is an older model, it will be difficult to refinance. It might make more sense to consider trading in or buying a new SUV if this is the case. You owe more on your SUV than it is worthWhen you owe more on your SUV than it is worth, it is referred to as being “upside down” or “underwater”. If this is the case, lenders may not see the value in refinancing your SUV loan.And now you can decide the best time to refinance an SUVIf the time seems right, Auto Approve is standing by to help you apply, compare offers, and determine the best refinancing option for you. Auto Approve never marks up the rate you pay, so you know you're getting the best rate available.With an A+ rating from the Better Business Bureau and a 96% would-recommend rating from Lending Tree, you can be confident that we will work hard to save you money.GET A QUOTE IN 60 SECONDS

It started with toilet paper and aluminum cans, then bicycles and lumber. The world has gone through wild cycles of demand and supply over the last year, but not many people could have predicted this economic brain-teaser: car prices are through the (metaphorical) roof, with no indication of slowing down. For decades, conventional wisdom has held up for individuals who are purchasing a car. If you get a brand new car, you’re told that its value depreciates as soon as you leave the parking lot. A used car’s value only went down with time and kilometers. Conversely, if you were in the market for a used car, you could count on paying a fair price given the age and usage of the vehicle. In 2021 however, used car prices saw their biggest price increase in 68 years. Here’s what that looks like, according to Business Insider: An inflation by any other name...When the May consumer price report was published earlier this year, there was one glaring anomaly that, given the circumstances, was very alarming. The US was finally showing signs of coming out of the pandemic-induced recession, and business trends were looking up. However, the data showed inflation rising at the fastest pace since the 1990s. Some people (and economists) are using this data as signs that a long inflationary period is on the horizon. Could the government policies and market trends during the pandemic actually lead to a multi-year, super-inflationary period?Turns out that the trend was driven in large part by the uptick in just a few categories. According to Vox.com, about half of the increase in prices could be attributed to just four categories: used cars, rental cars, hotels, and plane tickets. Notice a pattern?Source: Vox.comDemand for cars and travel: Fast and furiousIn a normal year, used car prices typically rise about 1% annually. In 2021 so far, used car prices are up nearly 30 percent. Two factors are behind this unprecedented rise: supply chain disruptions in the new car market due to a global shortage of semiconductor computer chips, and the available inventory of cars.The semiconductor chip shortage: This has been a weird year for semiconductor microchip manufacturers (and everybody else). Car manufacturers cancelled orders for new chips early on in the pandemic because of low forecasted demand, but the opposite scenario turned out to be true. Earlier in the year, there was a major shortage of microchips, especially for North American car companies like Ford and General Motors. Fewer new cars were manufactured or brought over to the US. Available car inventory is low: With almost no US company able to manufacture new cars, used vehicles became harder and harder to come by. This led to a continent-wide inventory shortage. There just aren’t enough cars as there are potential car buyers. Dialing it in: how do these macro-trends impact you and your financial goals?At first glance, it may seem like buying a car is not a financially feasible decision anymore, at least in the near future.However, the rise in car prices have led to an unanticipated bonus for potential car buyers: auto loan refinancing approvals have increased 66% since May 2020, for the most part due to the rise in vehicle values and their positive impact on loan-to-value ratios (more on LTV later).It’s a win-win. Sellers get the immediate payoff from the current prices, especially if they’ve been wanting to sell or trade-in their wheels for a while. Buyers are getting approved for auto refinance requests more than ever before. As vehicle values go up, the Loan-to-Value ratio adjusts downward automatically. Since a lower LTV makes it easier (and cheaper!) for borrowers to refinance, this is a great opportunity for buyers in the market.Loan-to-Value (LTV): what it means and why it mattersLTV, or Loan-to-Value, is an important ratio to know when you’re financing a large purchase like a car or a house. It is a measure of risk, showing lenders (and buyers) to what degree a loan is backed up by a tangible, real asset. LTV is calculated by dividing the loan amount by the fair value of the asset. Say the car that you’re purchasing is $20,000 and you get a loan for $15,000, your LTV ratio is 75%. That means that 25% of the appraised value of the asset is not covered by the loan. The Loan-to-Value ratio is an important consideration when lenders are figuring out who they can loan out to (and at what rate). LTV ratios trending lower are great news for borrowers who may not have been able to get approved for auto loan refinancing in the past. Similarly, borrowers who already qualified for a refinance will get better loan terms if they apply now. Advantages of refinancing your auto-loanAccording to Experian, the average loan amount for a new vehicle is $33,739, and a used one usually runs up to about $20,723. Since a car is a major purchase for most people, going for refinancing while approval rates are so high can help you lower your interest rate, reduce your monthly payment, and improve your cash flow. Essentially, refinancing a car loan involves borrowing money from a new lender to pay off the current car loan lender in order to get more favorable rate terms on your new loan. Here are more details on how you can benefit from refinancing your car loan:1. You’ll end up paying less interestMost borrowers will end up paying less interest over the term of their loan if they refinance. Here is a calculator you can use to find out how much money you’d be saving through a refinance. The final amount depends on the remaining life of your loan and your new rate, but usually taking a few hours to refinance your auto loan can add up to hundreds (if not thousands) of dollars over years. 2. You can improve your cash flowIf you purchased your car a few years ago, you would not have had access to today’s historically low rates. Or maybe you financed your car through the car dealership, which generally doesn’t have the lowest rates in the market. Finally, if your credit score or income was lower than what it is right now, you can almost guarantee a lower rate through a refinance. While there are fees associated with refinancing an auto loan, borrowers almost always save more than they spend. Generally, if you refinance early on in the life of the loan, you’ll save more money. Personal finance website Credit Karma found that the average savings for members who refinance loans through its service is $3,000, or about $55 per month.3. Your LTV value will most likely improveRefinancing your auto loan may lead to a lower LTV ratio. Your car gets a brand new appraisal during a time when car valuations are much higher than previous years, so the ‘value’ part of the Loan-to-Value ratio goes up. A lower LTV in turn can allow you to make smaller monthly payments, if that is what fits into your budget right now. It also means you have more equity in your asset (your car), and you can use that higher valuation to support other financial moves (like using it as collateral for a business loan, etc).Why now is the perfect time to refinanceThe pandemic caused an unprecedented reduction in the supply of both used and new cars. And pretty much immediately, prices went up. This market bubble, combined with the historically low rates that the government has introduced, presents an opportunity for car buyers to refinance their car purchase. With a 66% increase in auto refinance approvals since last year, borrowers should take advantage of market trends while they can. There is a strong case for consumers to secure a refinance during a period of historically low interest rates and high car values. If you’ve been thinking about refinancing your auto loan, now is the time to apply. Unlike refinancing a mortgage, refinancing a car loan is extremely easy. It can almost entirely be done online and within a couple hours in most cases. Prospective buyers who did not get approved for auto loan refinancing even a few months ago might be hesitant to try again, but remember that the lower LTV ratios right now mean that your application is more likely to get approved without you having to take any additional steps. Consumers with strong applications (great credit, stable income, low debt, for example) may get even better loan terms. Rates are as low as 2.25% right now, making the cost of borrowing almost negligible. Simply put, borrowers benefit when rates are low. If you’ve been looking for a way to cut down on your monthly expenses, this is one expense that can make a huge difference.Although car values are expected to remain high for another few months, the truth is that a trend like this quickly gets corrected through policies and market forces. Consumers and borrowers who have been on the fence should take advantage of this market sooner rather than later and refinance their auto loans while conditions are still so favorable. GET A QUOTE IN 60 SECONDS

Plans change, things happen, and unexpected events can throw us totally off-course from what we thought we needed in our daily lives. When it comes to the terms of your auto agreement, a lease might have seemed like an apt solution at one point; yet, due to circumstances out of your control, being in a car lease no longer makes sense for you.Fear not, millions of people find themselves in a similar predicament throughout the year, which is why it’s not uncommon to want to learn how to get out of a car lease contract early.It’s no secret that figuring out how to get out of a car lease agreement early can be a costly and lengthy process. But, you have options at your disposal that can make the entire experience more bearable, and we’re here to discuss them with you today. Whether you lost your job and can no longer afford the payments, or you need to outright own your vehicle for whatever reason, it’s time to investigate the alternatives that can put you into a better financial situation. Based on our research, we are going to provide you with 3 potential options below.How to Get Out of a Car Lease Early: 3 Routes1. Terminate the Lease Early: In many arrangements, your leasing company will offer you the ability to terminate your lease prematurely. This means you are free from making the remaining payments on the currently leased vehicle. But, in order to do this, you will have to turn in the car and pay the entire balance that is due, as well as the costs and fees that are probably going to be slapped onto the early termination. Remember that the Consumer Leasing Act does mandate that all of these details are included and available for you to review in the lease you have on record.So, let’s say you go for this option. The company may charge an early termination fee, which is normally the balance between the remaining balance and the credit you will receive from the value of the car. You may also have to pay a disposal fee, transfer fee, and taxes. All of this is disclosed inside of the signed lease.The fastest way to know what this total is going to be is to call up the leasing company and ask them point-blank what the total is going to be. You may also have to pay late fees, parking tickets, or anything else that has been accumulated as part of your leasing account.Since a car’s value typically depreciates more upfront, the earlier you terminate the lease, the higher the cost is going to be on your end. In many cases, the termination cost may be so high, that it makes more sense for you to complete the lease as agreed upon. If you don’t have the financial means to do this, you may need to finance the costs if it’s a life-or-death decision.2. Transfer the Lease: As you can see, terminating the lease may not be the most cost-effective option for you at this time. But you have another option: transferring the lease to a new lessee. In order to engage in this option, it needs to be one that is legal in your state, in accordance with your lease terms, and the party you are transferring the lease to needs to satisfy the requirements set forth by the lender.Don’t be fooled: this option will still come with hidden fees, like the lease transfer fee and other costs that will pop up. You should do your due diligence and ask for a final total from the leasing company before you opt for the early termination. If you are struggling to find a company that you can transfer your lease to, you can consider using a service that connects you to a new lender.3. Buying Out Your Lease: Depending upon the scenario, buying out the car entirely may be one of your best options with early termination. Yes, there are still fees involved; but, it’s worth running the numbers and seeing if an early buyout, along with the associated fees, comes in at a lower amount of what you could get if you go through with selling the car on your own. Or at least, if selling the car thereafter is still a feasible financial option when compared to the other two options listed above.Do note: in order to pursue this solution, you need to have the funds available to pay the early buyout fees. If you don’t, you will need to factor in buyout financing as part of the deal.If the market value of the car ends up being higher than the leasing company predicted it would be, a lease buyout may be the perfect solution for you and your wallet.Bonus: if you are leasing or purchasing another car when you terminate the car lease early, you may be able to roll over the amount you owe on the car you are returning to the amount you are financing for a new car purchase. This will create a higher monthly payment, but it at least will be one singular payment that may be easier for you to manage and pay off.Is it a Good Idea to Get Out of a Car Lease Prematurely?In many cases, you may have no other choice. If you go through all scenarios above and receive quotes, you can compare them and see which one makes sense. If all three options still clock in higher than your monthly leasing payment, you may want to consider financing – or – sticking with your car lease until the contract is terminated.Note: many people buy out their leases to avoid excess mileage fees, especially if you drive more than was agreed upon initially, or because used car values have increased recently, making your current vehicle worth more than the dealer thought it would be several years ago.The worst thing you can do is agree to one of these options without hearing the final monetary amount, first. Don’t be afraid to demand that from your leasing company: it’s a service they owe you as your lessee. Are you ready to get out of a car lease contract early? We hope this article helped.GET A QUOTE IN 60 SECONDS

It can be easy to get caught up in the car leasing gimmicks that are floating around all media and advertising spaces today. Many of these ads will claim that a lease is only $58 per week or $139 bi-weekly. These companies will state that it is easier to get into a new vehicle through a lease than it is by outright buying the vehicle.It may sound wise in nature, yet this is not always the case, and we want to talk about it in this article. In reality, leases are often much more expensive than they advertise and end up costing more than just financing the car in the end. How does this happen? Through the fine print, hidden fees, and extra costs that come with breaking leases or engaging in something that is not included in the confusing contract you sign when you agree to a lease.In order to protect yourself from unknown fees before you sign that dotted line, we’re going to look at some of the hidden penalties you should review in a car lease.Fees at the End of a Car LeaseHidden Interest and Taxes: Interest and taxes are surely applied to your car lease, even if it’s something they leave out of that ‘$58 per week’ marketing ad. When these two elements are factored into the equation, it’s more like $80 per week, and that’s just with the terms provided when financing a car. This can vary based on state, county, and dealership, which is why you should always factor in a lofty sum of money to cover interest rates and taxes.Can I negotiate these lease charges? Although you may be able to negotiate other elements of the lease, you will most likely be unable to negotiate the interest rate, much less the taxes. Be sure to check if there are any tax breaks available in your state for a car lease (note: they are usually not enough to compensate for the high-interest rates that are charged by dealerships today).Administrative Fees (Twice): Dealerships will apply two different administrative fees to your lease as a part of doing business with them. The first fee will come when you initially lease the car. The second fee will come when you return the car after the lease is completed. These fees can be as much as $750 each time, justified as a way to compensate the administrative staff that will have to process the paperwork for the termination of the lease.In most cases, the average consumer is not surprised to see that fee the first time they take the car off of the lot. But, when they see the fee again after they return the car, they are shocked to learn that an extra $1,500 in total was omitted from that monthly payment number when they first inquired about the car lease.Termination Fees: Yes, you will be penalized if you decide to terminate a car lease before the agreed-upon date. You are probably thinking to yourself: but why? Isn’t the dealership receiving the car back in a better condition than if I had kept driving it? Whether you are moving, downsizing, or lost your job, any of these reasons will make it necessary for you to terminate the car lease. And, you have that right to do so, but you will be hit with a termination fee. The fee amount will vary based on the information in the lease you signed. Many people will find they end up paying the full amount of the lease via the termination fee, even if they turn the car in a year early. Be sure to ask the lessee to disclose what this fee is to you if you predict yourself needing to terminate the lease prematurely.Mileage Variations: A general car lease will enable people to drive 12,000 to 15,000 miles per year, give or take. If you go over this mileage count, you will have to pay for it – at 10 to 20 cents per mile. If you do the math, that means you would owe $1,800 on an extra 3,000 miles you drove over the preset amount. Extra mileage is one of the biggest ways a dealership makes a profit off of this lease – they can almost count on you breaking the agreement. If you predict yourself needing to drive a fair amount in the coming years, this is a major reason why a car lease may not make sense for you.Mileage Punishment – Auction Fees: Not only are you going to be slammed with fees per mile that you go over the agreement, but the dealer also reserves the right to tell you that you have to sell the car returned at auction. This means you are responsible to cover the difference between what the car sells for at the auction, and the initial value of the car that was configured based on the pre-defined mileage count. So, let’s say the dealer figured the car would be worth $13,000 after you returned it within the mileage count. If you go over that mileage count and the dealer determines the car is now worth $10,000 at auction, you are required to cover the $3,000 difference that they ‘lost’ as a result of your negligence. As you can see, this gives the dealer way too much wiggle room when it comes to the interpretation of the car’s worth. This is something you will want to hash out with the dealer before signing any paperwork. The Down Payment Omission: And finally, back to that $58 example above: this is a payment amount that is described after the down payment has already been put down on the lease. If you put a $5,000 down payment on the lease, your bi-weekly payment may only be $100 or $200 because you already paid handsomely to drive the vehicle. The moral of the story: that ad-based monetary amount is false.Need help refinancing your vehicle? We recommend you talk with our team first before signing any leasing paperwork. Auto Approve is here to help.GET A QUOTE IN 60 SECONDS

Countless articles cover refinancing a car or terminating car leases prematurely today. But, what about motorcycle loans? Does it work the same way it does with a regular car loan? The answer is yes, you can refinance your motorcycle loan, and we’re going to explain it in-depth below.Similar to refinancing a car, when it comes to refinancing a purchase as expensive as a motorcycle, you want to do your due diligence and make sure that all information has been considered and reviewed. There are plenty of aspects that culminate in the final decision, which brings us to the first important question of the article: why do you want to refinance your motorcycle?Figuring out your ‘why’ can help you make a more informed decision down the line. Maybe your monthly payments are too high, or your spouse lost their job. Or, perhaps your credit score has changed dramatically, and you feel you can secure a more favorable interest rate that is related to your eligibility as a borrower. Think about why it is that you want to lock in a new loan rate for you and your motorcycle as you learn more about your options. You will be able to save money if you refinance to a lower annual percentage rate (APR), but you will also need to lower your payment as well – which can be done by refinancing for a longer term. Whether you are trying to pay off your bike more quickly, or simply lower your monthly payments, you will be able to save money when refinancing your motorcycle loan.If all of this sounds confusing, it’s because it can be if you don’t review the information thoroughly. Regardless of your reason for refinancing, any vehicle or motorcycle loan is up for negotiation, especially if your credit score changes. It may be possible to even refinance with poor credit, but do note, the trade-off is higher interest rates in the end. That’s why you always need to do a side-by-side comparison of pricing options over the course of the loan term so you know if you are selecting the option that is best for you.How to Refinance a Motorcycle LoanWe’ve been conditioned to assume that refinancing anything is a lengthy and complex process. In fact, with proper preparation, refinancing doesn’t have to be overwhelming at all. Lowering the cost of your motorcycle financing can save you thousands over time, which can make the entire process worth it. Will it require extra time from you? Yes. But if you align with the right lenders, you can save time and money throughout the payment cycle of your motorcycle.So, you’re ready to learn more about refinancing your motorcycle. You want to figure out if there are savings in the refinancing process and all of the title fees that will be paid for by the interest savings. We applaud you for taking this first initiative, and learning more about what refinancing a motorcycle loan can do for you.Next, it’s time to think about the actual rates. How do you know if you are agreeing to a good rate?Step 1: Sift Through Your Options. When you know how much you need to borrow, you can start to compare rates and how they stack up against what you currently pay. Rates will vary by lender, your credit score, and the age and make of your motorcycle. Each lender will come with its own credit score requirements. In general, the higher your credit score, the better the rate you will be able to secure.Step 2: Use the Internet. There are many online tools that can help you arrive at a final number for repaying a loan. One of the tools is a refinance calculator, which can help you organize the loan amount and term, and how that relates to a final monetary amount.Step 3: Check Your Credit Score. When you apply for refinancing, lenders will submit a hard inquiry on your credit. This will temporarily lower your score (it will bounce back). That’s why you want to check your credit score ahead of time, so you know your current standing. You want to do your homework and pick the one company you believe will work in tandem with your loan requirements. Step 4: Look Out for Fees. The fees are where a lot of these companies make their money and are written right into the leasing or lending contract. The fees can come from a variety of things related to the application process. Be sure to ask any potential lenders if they charge any fees.Step 5: Collect Your Documents. By organizing the documentation you are going to need ahead of time, you will be able to expedite the process more quickly. Things you can gather include the vehicle identification number, the make and model, the value of your bike, and the bike’s insurance information. When all of this is gathered, you can complete the application form quickly and submit it. If the lender agrees to take you on, you will need assistance in paying off the loan since the lender will not permit you to pay it off on your own. Once this is done, you will begin paying monthly payments to the new one. Be sure to always check that the old loan has been settled before you stop making your payments on it. If the refinancing does not overlap, you could be pegged with a late payment penalty that will impact your credit score.Refinancing your motorcycle loan can be a viable option for you if you want to save money or benefit from an improvement in a credit score. Here at Auto Approve, we make refinancing painless for our clients, which is why we want you to know we can support you through the process.Get in contact with our team today.GET A QUOTE IN 60 SECONDS

Too many people assume that their auto loan is something they are locked into forever. They assume there is no wiggle room or alternative financing options that may make more sense down the line. When things and situations change in your life, the monthly auto loan payment you were once making may no longer be something you can afford. That’s when car refinancing comes into the picture.If you borrow money to purchase a vehicle, it’s always wise to check that you are not paying more than you need to pay. Given that rates are at historic lows, and auto values are at historic highs, it is almost a certainty that you can lower your monthly car payment. In most situations, even if your life situation hasn’t changed, you can save money by refinancing a better loan. But before you can do that, we want to provide you with a general overview of when you should refinance your car.When Should I Refinance My Car Loan?Contrary to popular belief, you are not obligated to wait any amount of time before refinancing your car loan. You have to, instead, meet the requirements for the new loan to refinance it. Time is not part of those requirements – you can refinance immediately after buying the vehicle if you want. You need to just be sure that you are pursuing a better deal, in the end, one that requires the least amount of money to be paid towards the vehicle.Note: in some states, you only need your new registration before refinancing. This may slow down the process by 4 to 6 weeks, which is why we recommend you engage in this part of the equation starting today.What Do I Need for Refinancing My Car?Generally, you are going to need to collect the following:Information about the current loan and lender, your account numberYour current total loan balanceVehicle information including the make, model, year, and VINWhy Should I Refinance?The two main reasons why people refinance their vehicles are to lower their monthly payment or lower their interest rate. The ability to borrow at a lower interest rate means you will pay less for your car after taking all of your borrowing costs into account. Since an interest rate is part of the monthly payment you agree to in the loan, it’s something that you should consider changing if interest rates change over time. Since interest rates are currently at historic lows, the time has never been better to refinance your car.When you replace the current loan with a lower rate, you will want to engage in this change as soon as possible. In some cases, you can skip 2 monthly payments as the loan is being transferred from one lender to a more favorable one. Note: most auto loans are amortizing loans, which means you pay a fixed monthly payment with interest that is already built into that payment. A lower interest would mean a lower monthly payment.When Should I Try to Refinance My Car Loan?NOW! Now is always the best time. The refinance process is simple, there is no risk for you to find out your available options, and in most cases, you will be very glad you elected to move forward. You will save money immediately, and even potentially receive a few month’s reprieve on making any car payments at all. If you have significantly improved your credit score since obtaining the original loan, you may be able to negotiate a lower rate or remove a cosigner from the loan. How can I improve my credit score? This happens when you make on-time loan payments for multiple months – or years. About 10-12 months is enough time to see a change in your credit score, which you can use as leverage to negotiate a better loan rate.Refinancing Mistakes to NoteRefinancing is tempting at times, but can also be a poor decision if you don’t follow the details mentioned above. Here are some of the most common pitfalls to avoid when refinancing an auto loan:Prepayment penalties do exist, which means you may have to pay extra if you pay off a loan before a term is up. Look up the details of your loan and inquire what this fee is going to be.Waiting too long to refinance. The longer you wait, the less sense it makes to refinance. Lastly, don’t miss any payments. If you think that the refinancing process has paused your payments, think again. You want to triple-check before you halt payment for the previous loan. We hope this has solved any problems related to your question: when should I try to refinance my car? As always, do your due diligence and call up your lender with questions before you make any decisions. Hidden fees, contractual obligations, and the actual value of the car should all be factored into any refinancing agreements. But, if the stars align, then there is no reason why you should not allow yourself to benefit from auto refinancing. It always makes sense to check your options and see how low you can get your monthly payment or your interest rate.GET A QUOTE IN 60 SECONDS