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Gap insurance (Guaranteed Asset Protection) is optional insurance that kicks in if your car is totaled or stolen. It essentially covers the “gap” between what you still owe on the car and the depreciated value of the car. Let’s look a little closer at how this type of insurance works, and when you should consider getting it.Here’s everything you need to know about gap insurance and when it is worthwhile to have.If you have a car loan, it is possible that the car may be valued at less than you owe on it. This is less than ideal, but it happens often enough with vehicle loans. This becomes a major problem if something drastic happens to your car. If your car is stolen or totaled and the insurance company only pays out what the car is valued at, it might not cover the amount that you have left on your loan. How Does Gap Insurance Work?Gap insurance kicks in when there is a gap between what insurance will pay and what you still owe on the car. Say you take out a loan for $20,000 on your new car, and a few months later your car is totaled while it is parked outside your house. You file a claim with your insurance company, and they agree to pay $17,000. The $3,000 difference is ultimately your responsibility, even though the situation was completely out of your control. Gap insurance ultimately works in conjunction with comprehensive and collision insurance to minimize or eliminate your out of pocket expenses.Do I Need Gap Insurance?Gap insurance is not technically required, but that doesn’t mean you shouldn’t consider it. Let’s look at a few different types of insurance and when they are required:Liability Insurance. This insurance is required by almost every state in the United States (excluding New Hampshire). It is composed of three parts: bodily injury coverage per person, bodily injury coverage per accident, and property damage coverage per accident. This covers any damage you may cause to another driver, their passengers, or their property, including their car.Comprehensive Insurance. This covers the cost of damages to your vehicle if there is a non-crash accident, such as weather damage or theft. Comprehensive insurance also covers damage that occurs if you hit an animal. Collision Insurance. This covers damages to your vehicle if you hit or are hit by another vehicle.If your car is financed, you may be required to get all three types of insurance. Even so, it is possible that this may not cover all of the damages, and you could still owe money on your car even if it is totaled.How Do I Decide If I Need Gap Insurance?If your car is not financed, you do not need gap insurance whatsoever. If your car is financed, it depends largely on the expected depreciation of your car. It is important to remember that cars depreciate rather quickly, losing about 20% of their value in the first year alone. It is always worth checking Edmunds or Kelley Blue Book to see what your car is worth. Here are some factors that might help you decide if gap insurance is necessary: You put less than 20% as down payment on your car. This makes you more likely to end up with negative equity as soon as you leave the dealership. Your car depreciates the minute you leave the dealership, so if you only put down a low down payment, you might immediately owe more than the car is worthYour car is a lease. Some leases require gap insurance in addition to collision, comprehensive, and liability.You drive a lot compared to the average person in your area. This will cause your particular car to depreciate faster. Your car model has a tendency to depreciate fast. Some cars simply lose value faster than other cars, while some cars hold their value extremely well. Gap coverage might be worthwhile if your car model doesn’t hold its value particularly well.Your car loan payment period is long. If your loan is 5 years or longer, there is a higher chance that your loan balance will exceed your car’s market value. Gap insurance can protect you from this depreciation.How Much Does Gap Insurance Cost?Like everything, the cost of gap insurance can vary greatly between insurance companies. If you go through your current provider, you can expect to pay a yearly flat fee of $500 to $700 for the coverage. If you finance through a credit union, you can expect a monthly add on of $20-$40. The following variables will affect the cost of gap insurance:Where you live.Your age.Previous claims history.Actual value of your car and total amount you owe.If your insurance company does not offer gap insurance, you can purchase it as a stand alone policy from another provider. At AutoApprove, we work with lenders to get the best rates on gap insurance possible, usually around $14 per month. As far as insurance coverage goes, it offers a great return of investment should you ever need it to kick in.Is Gap Insurance Really Worth It?You will need to do the math to determine if gap insurance is worth the investment.  First, go online to determine how much your car is worth. Use sites such as Kelley Blue Book and Edmunds to get a value for your make and model. It is best to find an end of year value for each year of your loan.Take a look at your loan terms. See how much you will owe each year, and compare this to what your car will be worth at the end of each corresponding year.Calculate how much gap insurance will cost for each year.Look at the difference in your car’s value and what you owe at the end of each year. Based on this, determine how much gap insurance will save you in the event of a disaster. If there’s a good chance your car will depreciate faster than you will pay it off, you should strongly consider gap insurance. Gap insurance ultimately covers what collision and comprehensive insurance do not cover, and can protect you from depreciation.At AutoApprove, we know that gap insurance can make good sense based on how quickly cars tend to lose their value. We work closely with lenders and help you shop around for the rates and coverage that fit your needs most. So if gap insurance makes sense to you, contact us today to see how we can help.GET A QUOTE IN 60 SECONDS

There are a number of reasons why you might want to get out of your car lease early. Maybe you just lost your job, and the payments are too much to keep up on. Maybe the car isn’t as great as you hoped it would be, and it’s just not fitting your needs anymore. Or maybe, you want to be done with leasing and simply own the car outright. Whatever the reason, you have decided that you need to make a move and get out of your lease as soon as possible. So how do you do it?If you are wondering how to get out of a car lease early, these are the three main options: transfer the lease, return the car, or buy the car.Transfer the LeaseA very popular option to get out of a lease early is to transfer your lease to another person. Websites such as leasetrader.com and swapalease.com can help match you with someone looking to take over a lease. It is important to look at your lease agreement however, as not all leases permit a third party transfer. Furthermore, you must ensure that it is legal to do so in your state. The new lessee must also meet the lender’s requirements. If you are able to transfer the lease, you will most likely be held responsible if the third party stops making payments. You will also be required to pay any transfer fees, which can range from $500 to several thousands of dollars. It is common to offer incentives for people to take over your lease as well. An extra $500 to anyone willing to take over your lease might convince someone who is on the fence that taking over your lease is a good move. All of these costs add up for you however, so be sure to compare the costs between a lease transfer, early termination, and lease buyout.Return the CarThe simplest way to get out of a lease early is to terminate the lease agreement and return the car. This can also be the most costly option. When you terminate a lease early, you may be responsible for all or some of the following:Early Lease Termination FeeEarly lease termination fees vary widely from lease to lease. They are often based on a sliding scale, making it more burdensome to pay off the earlier you are in your lease. For example if you terminate your lease in the first year, you may be required to make three additional monthly payments, whereas if you terminate your lease in the second year you may only be required to make two additional payments. Review your lease agreement thoroughly to determine your responsibility.Remaining Payments on your VehicleYou may be required to pay all or some of the remaining payments on your vehicle. This is potentially the most expensive part of exiting your lease early. If you decide to terminate your lease with 18 months left on your contract and your monthly payments are $300, you may be on the hook for $5,400 in addition to the other fees associated with termination. Any Costs Related to ResaleThe lease agreement will often require you to pay a disposition fee, which covers any costs associated with reselling the car. This could include getting the car thoroughly washed and detailed, fixing any cosmetic dings, and performing any necessary maintenance. This can range from a few hundred to a few thousand dollars depending on the condition of your car. Taxes Associated with LeasingIf there are any additional taxes associated with the lease, you will be required to pay those. This will vary greatly state to state.Negative Equity Between Your Lease and the Current Market ValueNegative equity is when you owe more than something is worth. This is also referred to as being “upside-down” or “underwater”. When it comes to a lease, it means that your monthly payments are not paying down the balance of the lease faster than the car is depreciating. Your lease agreement might require you to pay some or all of this difference in the car’s value.Storage and Transportation of Your VehicleAny costs related to the physical removal and storage of your vehicle will be your responsibility to pay.As you can see, all of the lease termination fees often make this the most expensive and least practical way to get out of a lease early, but it is definitely the most straightforward. Buy the CarSometimes the most financially beneficial way to end a lease early is to buy the car from the lender. If you have the capital to do this outright, you can simply buy the car and pay for any associated fees. If you do not have that amount of cash on hand, you can opt for a car lease buyout loan. Here is how to buy your car from your lease agreement.Determining Your Car’s ValueEvery car lease has a residual value that is listed in the loan agreement. The residual value of a car is based on your car’s expected depreciation over the life of your loan and is predetermined by the leasing company. It is usually non-negotiable. This is the number that you are bound to should you choose to buy your car.It is important to also look at your car’s market value. This is based on the demand for your car, and will give you an idea of how much you can get if you resell the car. It is important to know what the market value is of your car to determine if it makes sense to purchase it. If the residual value of your car is $13,000, but the market value is $11,000, it would mean that you are paying $2,000 more than what your car is worth. Consider these values and determine if a car lease buyout makes sense for you. Maybe you want to keep the car for yourself and you are comfortable with paying for the residual value. Or maybe you want to resell the car, and you will still make money on the transaction based on the market value of the car. Other Considerations for Buying Out Your LeaseBuying your car from your lender can release you from fees that you might otherwise have to pay. Leases often include charges or penalties for the following:Excessive Mileage. Most leases have yearly mileage limits, and if you exceed that mileage amount, you can be paying huge penalties. These penalties can range from $.10 a mile to $.30 a mile, which can add up to several thousands of dollars if you drive a lot. Wear and Tear. When your car is turned in after your lease is over, it is subject to inspection. Dealers will charge you for any external dents, stains to the interior, and anything else they think will hurt resale value. These fees can vary greatly depending on the condition of your car.Disposition Fees. Dealers will usually charge you a disposition fee, which covers all costs associated with reselling your car. Think of all of these fees as money that can be put towards buying your car from your lease. If the fees add up to $3,000, it might make sense to take that $3,000 and use it to invest in the purchase. It is always a good idea to call your lender directly and find out exactly how much it will cost you to buy your car from your lease. Obtaining a Lease Buyout LoanIf you’ve done the math and determined that buying out your lease is the best way to terminate your lease early, you may need to obtain a lease buyout loan. Not all lenders offer this type of loan, but at AutoApprove we work closely with lenders that provide these loans and will work tirelessly to find you the best rate possible. To get a lease buyout loan, you will need to take the following steps:Call your existing lease company. First, find out how much it will cost to buy your car. Tell them you are looking to buy out your lease and see if they provide that service.Shop around for rates. At AutoApprove we can jump start this process for you and help you start comparing rates.Call your existing lease company, again. Give them a chance to beat any competing rates that you may have found.Sign the papers and notify your insurance company. Make sure all of the necessary papers are signed, and tell your insurance company about the new lender. Since you will no longer have a lease, you may be able to reduce your coverage and your monthly payments, as you will no longer be required to have high liability coverage.Keep it or sell it. Now that it’s yours, you can decide if it’s worth keeping it, or selling it and keeping the profit.It is not always easy to get out of a lease early, but there are options available to do so.The best option will depend largely on your financial situation, but it rarely makes sense to terminate the lease outright. Finding a third party lessee or securing a buyout loan will often be the most beneficial options. If you are interested in obtaining a car lease buyout loan, be sure to contact AutoApprove today to get more information.GET A QUOTE IN 60 SECONDS

Leasing a car is a very popular option for many these days. But what happens when you love your car, and you just can’t bear to say goodbye?When your car lease comes to an end, you typically have three options to choose from: lease trade in, lease turn in, and lease buyout. Here, we'll discuss your three options and help you decide if a car lease buyout is the right move for you.What is a car lease buyout and does it make sense for you?In short, a car lease buyout lets you buy your existing car from your lender.When your lease term comes to an end, you have three main options to consider. About three months before your lease end date, your lender should contact you to review your courses of action.Understanding Your OptionsLease Trade InA lease trade in is when you trade your old car in for a new car lease. In this case, you should determine your car’s value and compare it with the lease-end residual value that is listed in your lease contract. If the trade in value is higher (which is rare), you can use the difference to put a down payment on a new vehicle.In most cases, the residual value will be higher and it will make more sense to return the car and start a new lease.Lease Turn InA lease turn in is exactly that; you return your car to the dealer as is. You will have to look at your contract carefully and determine if you are responsible for any fees. An inspection will be performed when you trade in your car and you will be responsible for excessive wear and tear, any dents and dings on the exterior of the car, and any stains or tears on the car’s interior. Excessive mileage fees may also apply, which can add up fast.Lease BuyoutA lease buyout lets you buy your car directly from your lender. If the first two options are less than ideal, a lease buyout might be the right option for you. In most cases, you can buy your car lease at any point during your lease period. If you want to buy out your loan early, you will need to discuss this with your lender as it will affect the residual value of the car. It is often not financially beneficial to buy a lease out early. It is much more common to wait until the end of the lease period to broach the subject of a lease buyout.  How a Buyout WorksA car lease buyout is different than buying a new car. You already have knowledge of your car’s condition so you should have fewer concerns over the investment. The buyout loan amount will also be significantly less than buying a new car. Let’s look at what you should consider when deciding if a lease buyout is right for you.Valuing Your CarFirst and foremost, you should determine the value of your car. There are two main factors that you should consider:Residual Value. Your car’s residual value is listed in your existing loan contract. The residual value of a car is based on your car’s expected depreciation over the life of your loan and is predetermined by the leasing company. This number is usually non-negotiable.Market Value. The demand for your car will greatly affect the market value of your car. If it is a popular make and model, it will have a higher market value. Use websites such as Cars.com, Edmunds.com. Or Kelly Blue Book to determine the market value of your car.When you are buying out your lease, you are bound to the residual value of the car. It is important to know what the market value is of your car to determine if it makes sense to purchase it. If the residual value of your car is $16,000, but the market value is $13,000, it would mean that you are paying $3,000 more than what your car is actually worth. There is no rule on when exactly it is worthwhile to purchase your car, but if the residual value is within a few hundred dollars of the market value, it is probably a fair deal.Additional Buyout ConsiderationsIf you are happy with the residual value of your car, there are a few more factors to take into consideration.Excessive mileage. Have you exceeded the mileage amount allotted in your lease agreement? If so, you will be subject to per-mile penalty fees that can vary from $.10 to $.30 per mile. If you were consistently driving several thousand miles per year over your limit, that can add up to several thousand dollars. If you choose to buy your vehicle, you will not have to pay these fees, so this money can instead be put towards your buyout. Your car’s condition. Your car is subject to inspection when your lease period is up. You will be charged a fee if there is excessive damage, such as exterior dents and dings, interior tears and stains, or mechanical issues that the dealership considers beyond normal wear and tear. Disposition Fee. The disposition fee covers all costs associated with reselling your car, and can be a few hundred dollars. This pays for the dealership to clean and detail the car, and make any necessary repairs before reselling.Cost of maintenance. If you want to keep your car, it is important to do additional research to determine what your cost of maintenance will be in the next several years. If there are several expensive maintenance costs that will pop up, you will need to compare this cost with the savings from the other fees.How to Buyout Your LeaseYou’ve run the numbers and you think that buying out your lease makes the most sense and is your best option. What next?Call your existing leasing company. Get a comprehensive list of all costs associated with the buyout. Make sure this number includes sales tax, which can be a significant amount.Shop around for rates. Go online and look around at different rates. Not all lenders offer buyout loans, so you will have less options than when you originally financed your loan. It is also important to note that lease buyout loans are used car loans, which tend to have higher interest rates than new car loans. At Auto Approve, we work with lenders that do offer lease buyout loans, and can help you get the best rate available.Your rates will be based on prevailing interest rates in the industry as well as on your personal finances, just as your initial loan. Make sure you have all necessary documents for your loan application: Photo IDYour Vehicle’s InformationProof of Income and Financial HistoryProof of ResidenceProof of InsuranceHaving all necessary documents ready to go will help to streamline this process. Be sure to apply to all lenders within a fourteen day period. The credit bureaus allow all credit inquiries in a fourteen day period to count as one credit hit, so it will not adversely affect your credit score more than necessary.When the lenders respond with their offers, compare the rates and terms. At AutoApprove, we can help you shop around to compare rates and terms to find the best option for your buyout loan. Call Your Insurance CompanyYou will need to notify your insurance company of your new lender. This is also a good chance for you to review your insurance needs. On a leased vehicle, you are typically required to have high levels of liability coverage. You may decide that you do not need such a high level of coverage based on where you live or how much you drive, and you can opt for lower payments by reducing this coverage. Make Sure All of Your Paperwork Is In OrderTalk to your lender and be sure to visit your state’s motor vehicle department to transfer the title and make sure all of your paperwork is in order. Your lender should be able to guide you specifically through what steps you need to take. And when you work with Auto Approve, we handle the DMV paperwork for you!Ready to buy out your lease? Auto Approve can helpIf you have considered all of your end of lease options and determined a lease buyout is the right option for you, we're here to help you with the next steps so you can keep your car, hassle-free.At Auto Approve, we never mark up rates on car buyout loans or vehicle refinancing, so you know you're always getting your best possible rate. We pass all of the savings right on to you. We know car financing can be complicated and stressful, but we're here to streamline the process and save you as much money as possible.Check out our auto lease purchase options and get started today!GET A QUOTE IN 60 SECONDS

So, you have a car, you love it, but the interest rate... isn't so hot. You're probably wondering whether refinancing could help and, if so, when you can refinance.First, let's talk about vehicle refinancing.When you refinance a car, you are paying off your existing loan with a new loan that ideally has better terms. Just as you are able to obtain a vehicle loan whenever you would like, you are also able to refinance a vehicle loan whenever you would like. But there are many factors to consider when trying to determine the best time to refinance a car and whether or not it makes sense for you right now.Let's take a look.When can you refinance a car, and when is the best time to refinance?There are many factors to consider when it comes to refinancing. Here are some things to think about when determining if refinancing is a good idea for you right now.Your Existing LoanFirst and foremost, it's important to look at the terms of your existing auto loan.Sometimes, lenders will have prepayment penalties attached to the loan, so it is important to know what the penalties will be if you choose to refinance. If there are prepayment penalties, be sure to do the math to determine if the savings of refinancing will outweigh the downside.When determining the best time to refinance a car, it depends heavily on how long you have had your original loan and how many payments are remaining. Let's take a closer look at that.It’s the beginning of your auto loanWhile you can technically refinance immediately after you get your initial loan, it is generally better to wait a bit before refinancing your car.60-90 Days: This is the amount of time it typically takes for the title on your car to transfer. You need to wait until all the paperwork is finalized to refinance, so it's actually unlikely you'd even be able to refinance in this first period of time.Up to six months: It takes some time for your credit score to bounce back after the hard inquiry from your first loan. If you have fantastic credit, this might not be an issue. But, typically, waiting at least six months will yield more beneficial refinancing options. If you are a first time car loan borrower, it is recommended that you wait a year before refinancing your car. This will prove an on-time payment history and make you a more desirable candidate and qualify you for better loan terms and rates.It’s towards the end of your auto loanTo talk about why this matters, we need to get into the nitty-gritty of loans for a moment.First, how does interest on a loan work? Through amortization, the amount of interest you pay gradually decreases over the life of the loan. This means in the beginning of the loan, you are paying off more interest than towards the end of the loan. Let’s look at how car loans are constructed and how car payment amortization works.Car loans accrue simple interest. This means that if you take out a car loan for $20,000 at 5% interest with a 48 month payment, you will pay back $2,108.12 in interest, with monthly payments of $460.59 for the next four years. However, car loans are amortized and “front-loaded”, meaning that, in the beginning, your payments aren’t split evenly between your interest and your principal. The amortization schedule below shows how your monthly payments are split up for the first six months of your loan.Let's look, for example, at a $20,000 loan at 5% interest over 48 months.Month: 1Principal Amount: $20,000.00Monthly Interest Payment: $83.33Monthly Principal Payment: $377.25Ending Balance: $19,622.75Month: 2Principal Amount: $19,622.75Monthly Interest Payment: $81.76Monthly Principal Payment: $378.82Ending Balance: $19,243.92Month: 3Principal Amount: $19,243.92Monthly Interest Payment: $80.18Monthly Principal Payment: $380.40Ending Balance: $18,863.52Month: 4Principal Amount: $18,863.52Monthly Interest Payment: $78.60Monthly Principal Payment: $381.99Ending Balance: $18,481.53Month: 5Principal Amount: $18,481.53Monthly Interest Payment: $77.01Monthly Principal Payment: $383.58Ending Balance: $18,097.95Month: 6Principal Amount: $18,097.95Monthly Interest Payment: $75.41Monthly Principal Payment: $385.18Ending Balance: $17,712.78As you can see, in the earlier months you are paying more in interest than you are later on. Based on this amortization, you can see the total yearly amount paid in interest.Interest Paid:Year 1 - $894.80Year 2 - $657.79Year 3 - $408.68Year 4 - $146.83The majority of your interest is paid in the first two to three years that you have your loan. That means that the longer you wait to refinance, the less beneficial it will be to do so. This is because one of the major benefits of refinancing is less paid in interest over time, but if your interest is mostly paid off, you won't get to see that benefit.Current Interest RatesWhen deciding whether now is a good time to refinance a car loan, look at the current interest rates being offered. Are they better than your original interest rate? Depending on the size of your loan, even a .5 % difference can make a huge difference in the total amount you will be paying.Your Current Credit ScoreCheck your credit score using one (or all of the) of the three major bureaus: Equifax, Experian, and TransUnion. Is your credit score better than it was when you initially applied for a car loan? If so, now might be a good time to refinance.On word to the wise: Refinancing will result in another hard inquiry on your credit report, which will negatively affect your score for about a year. It may also lower the average age of your accounts, which can negatively affect your credit score. So, if you need a high credit score for another reason, like applying for a new mortgage or taking out a new lease on an apartment, consider this in your decision to refinance your car. However, there's no hard inquiry involved in getting a quote, so if you're not sure whether the savings will be enough to make a difference, you can always get a quick and easy quote to help make your decision.Your Current Financial SituationIf you need a little more breathing room every month in your budget, now might be a good time to refinance. By reducing your interest rate or lengthening the payment period, you can reduce your monthly payments. And, for those who need a break from their car loan, refinancing can also give you a few months off from payments.On the flip side, if you would like to pay off your loan earlier, refinancing to a lower rate and shortening your payment period will save you money in the long run. Depending on your current loan, you may even be able to pay less monthly and less in interest over time!When It Doesn’t Make Sense to RefinanceThere are times when refinancing will not be beneficial to you. If any of the following apply to you, it might not be the best time to refinance your car:Your credit score has decreased. You will most likely not find a lender to give you a better rate, unless your current loan is at a really bad rate.Your vehicle has a lot of miles on it. Most lenders have a minimum loan amount and if the car has depreciated in value significantly, it may not be worth your while.Your loan is “upside-down”. If you owe more on your vehicle than it’s worth, you may struggle find a lender that will be willing to refinance at a good rate.All that said, if you're on the fence, it can't hurt to try — getting a quote doesn't require a credit check and can give you an idea of whether or not you should refinance in just a few clicks.And that's everything you need to know about when you can refinanceWhile there are few limitations on when you can refinance, you can use this tips to time your refinance correctly to get the best possible deal. In order to find the best time to refinance your car, take a look at your current loan’s terms and payment period as well as your personal finances.Depending where you are in your repayment schedule, refinancing could save you a bundle. At Auto Approve, we help you find the best refinancing options for your situation. If you’re interested in refinancing, use our quote tool and we can help you find you your best possible savings to put more money back in your pocket.GET A QUOTE IN 60 SECONDS

Let’s talk about vehicle service contracts – what they are and why you could end up wanting one.See, as part of purchasing a new car, typically, repairs and mechanical issues are covered by the manufacturer’s warranty – for a few years. This coverage provides consumers with peace of mind when first purchasing the vehicle, but a few years down the line, it will fall on them to pay for these repairs that are no longer included in the contract. Since most cars last 5, 10, or even 15 years on the road (depending on the make and model), you can be stuck paying out of pocket to keep your car running smoothly for many years. After all, we all know that cars come with their fair share of mechanical problems over time. That’s why investing in a program or agreement that can provide you with mechanical coverage throughout the lifetime of your vehicle is worth considering. A vehicle service contract acts as a form of insurance policy as your car ages, providing you with the coverage you need while acting as an intermediary on your behalf.Here's all your questions answered about Vehicle Service Contracts.How Does a Vehicle Service Contract Work?Like an insurance policy, you pay upfront into your service contract. If your car ever needs any repairs covered, the provider will foot the bill on your behalf. This way, you don’t have to worry about any sudden repairs totaling thousands of dollars that can completely destroy your savings.In this article, we will give you an overview of vehicle service contracts, how to use them, and all other pertinent details related to providers, so you can make the best decision in the end. We have reviewed top extended car warranty providers and ranked them on things like customer service, coverage options, etc. below. What is a Vehicle Service Contract?As mentioned, a vehicle service contract is a paid plan that covers costly repairs after the warranty on your vehicle has transpired. Also called an extended car warranty, the service contact is available to both new or used cars. Note: as the car ages, the likelihood of frequent repairs increases, which means the contract will be quoted at a higher rate than one for a younger car.Is there a difference between a vehicle service contract and an extended warranty?The short answer is: yes. Vehicle service contracts do not extend a manufacturer’s warranty – only the manufacturer can agree to that. The contract mimics the factory warranty coverage as a third party, providing additional coverage that is not provided via the manufacturer. Also note: not all vehicle contracts are made equal, so be sure to check out the extended car warranty available to you as well and compare the two.What Are the Two Types of Vehicle Service Contracts?You have a regular and exclusionary contract option. The regular contract will list all of the things that are covered in the agreement. The exclusionary will list everything that is not. If possible, opt for the regular contract that does not use backward logic – it can be easier to identify what you are buying with the agreement.What Are Vehicles Service Contract Price Ranges?There is no one-size-fits-all when it comes to vehicle service contracts and pricing. The cost of the contract will depend on your vehicle’s make and model, as well as the condition of the car. It will also depend on what level of coverage you agree to, and if you want the provider to cover 99% of breakdowns and repairs. Just like an insurance policy, if your car is older and riskier to the lender, they are going to require that you pay more for the contract.In general, these contracts can range from $199 to $1,000. Most vehicle contracts will fall into the $350 to $750 per year range. You will want to compare how much typical repairs for your vehicle will cost, when compared to this coverage. If you figure that you will owe around $1,000 this year in repairs, then taking on a $500 contract may make sense.How Do I Use My Vehicle Service Contract?You can access the contract anytime your vehicle needs a repair. Like any insurance company, all vehicle service contract providers will include different tiers of coverage. Not every tier is going to cover every possible repair, which again, is why you will want to review all details before agreeing and signing. Each provider will also have their own process as to how claims are filed, and ultimately, covered. Some providers will require that you pay for the repair and then they reimburse you. Other providers will partner with repair facilities and not require this kind of capital be fronted in order to engage with the repair. It depends on your cash flow and what you know is possible for your finances.Vehicle Service Contract Exclusions to NoteWhen you purchase this contract, you will want to review it carefully. Most contracts will list all of the parts that are covered, however, should you find yourself with an exclusionary contract, you will want to review what is instead, not covered. Even if it appears that the repairs that you do want to be covered are not on the exclusionary list, you will want to clarify with the company exactly what their contract means.Should I Purchase a Vehicle Service Contract?These contracts can make a lot of sense for used vehicles, which can come with complications down the line that you were not originally aware of. If you purchase the vehicle from a reputable brand, it is recommended to first inquire into the extended warranty package and how it compares to a rate from a vehicle service contract. And that’s everything you need to know about Vehicle Service Contracts.For many people, knowing there is a ceiling on how much they are going to pay for their vehicle’s repairs is all they need. Here are Auto Approve, we are proud to provide you with the real, genuine information you need to make smart decisions for your vehicle. We hope you have found this article to be helpful and informational.

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

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

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

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