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Rebecca Betterton is the auto loans reporter for Bankrate. She specializes in assisting readers in navigating the ins and outs of securely borrowing money to purchase a car.
Rhys has been editing and writing for Bankrate since late 2021. They are passionate about helping readers gain the confidence to take control of their finances by providing clear, well-researched information that breaks down otherwise complex topics into manageable bites.
Mark Kantrowitz is an expert on student financial aid, the FAFSA, scholarships, 529 plans, education tax benefits and student loans.
Bankrate’s best refinance auto loans are chosen based on lenders’ interest rates, customer experience, available terms and transparency. Lender benefits and drawbacks are fully outlined to help you determine what the best financing option is for you.
Refinancing your auto loan allows you to replace your current loan with a new one in order to get more favorable terms and lower rates. They are available through a variety of lender types, so it is wise to shop around to consider which fits best for your needs.
When it comes to refinance loans, pay special attention to eligibility requirements and available terms. Doing so allows you to know whether your current loan qualifies, and you can adjust your loan to fit your monthly budget.
Determine how much you are currently paying in interest, your monthly payment, how much you’re set to pay over the life of the loan and what rate you can afford.
Check to see if your credit has improved since your original loan approval. The higher your credit score, the better your rate will be.
Estimate the worth of your vehicle in order to determine if lenders will be willing to refinance.
Available interest rates vary by lender so shop around with at least three different providers. Be sure to compare potential rates with your current loan.
Gather the necessary documentation and details of the current loan so you can walk away with better rates and terms.
Choosing the best lender comes down to saving you money — either overall or month to month. It’s recommended that you get quotes from at least three lenders before deciding which is right for you. When shopping for an auto loan, compare APRs (annual percentage rates) across multiple lenders. Look for lenders that keep fees to a minimum and offer repayment terms that fit your needs. Pay close attention to the following factors:
Every lender has different requirements to receive approval. Lenders will consider aspects like your credit history, income and debt-to-income ratio.
But refinance loans have their own specifications on vehicle and existing loan requirements. Look out for acceptance criteria based on factors like vehicle age, mileage or time you’ve had the loan.
The goal of a refinance auto loan is to walk away with a more affordable monthly payment or lower cost overall. So be sure to compare the specifics of the potential new loan with your current rate. Keep in mind that a longer term is not always the best idea because you can pay more interest.
Through refinancing you can extend the life of your loan and lower the monthly payments or pay off the loan quicker and reduce the total cost. Consider which option fits your budget better when determining which lender offers the best terms.
The listings that appear on this page are from companies from which this website receives compensation, which may impact how, where and in what order products appear. This table does not include all companies or all available products. Bankrate does not endorse or recommend any companies.
The annual percentage rate (APR) includes your interest rate, plus any loan fees. It reflects the total cost of borrowing.
The period of time until your loan achieves maturity and is paid off in completion. Terms can be expressed in months or years, depending on the details of your loan.
The minimum credit score typically required to qualify for a loan with a given lender. Exact thresholds are not always disclosed by a lender and in certain cases the minimum score is the best estimate based on publicly available information. Credit score refers to FICO 9.0 unless otherwise stated.
REFINANCE
3.9
2.83- 36.00%
24-60mo
700
REFINANCE
3.5
3.19%
48-60mo
700
REFINANCE
- Get approved in 2 minutes or less for credit lines up to $200,000.
- Apply once, even if you aren't ready to purchase for up to 24 months
- Use Flexline™ to buy new or used vehicles, buyout leases or refinance loans.
- No impact to credit for pre-approval. One hard credit pull to access line of credit for life*
- *Lifetime access with rotating balance, lifetime access expires with 24 months of inactivity
REFINANCE
3.8
7.29- 11.54%
36-72mo
700
REFINANCE
4.59- 14.99%
24-84mo
600
REFINANCE
4.2
3.24%
36-60mo
Not disclosed
REFINANCE
3.9
2.69%
60mo
700
REFINANCE
3.2
2.49%
60mo
700
REFINANCE
2.99- 24.99%
60mo
Not disclosed
REFINANCE
3.9
3.12%
48-60mo
700
REFINANCE
4.2
6.49- 14.24%
24-84mo
700
REFINANCE
4.1
2.20- 29.99%
24-84mo
Not disclosed
Loan details presented are current as of November 7, 2022. Check the lenders’ websites for more current information. The auto loan lenders listed here are selected based on factors such as APR, loan amounts, fees, credit requirements and more.
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Refinancing a car loan is essentially just taking out a new car loan — so the steps for applying are mostly the same. You’ll need your driver’s license, Social Security number and proof of income and insurance, as well as details about your car. If approved, you’ll use the funds from your new loan to pay off your old car loan, then begin making monthly payments with your new interest rate and terms.
When you refinance your car loan you receive a new auto loan that replaces your current one. The process is similar to that of getting your initial loan. Following application and approval, you will pay off the initial loan with your new one, then begin making payments on your new loan.
Refinancing your car loan comes down to saving you money. If you are struggling to afford your vehicle payments or think you could receive more favorable terms, it’s a good idea to consider refinancing your current loan. Here are the three main scenarios where refinance is the right choice.
As with any loan, it is best to shop around to different lenders before making your final decision. Each lender has its own methodology when determining your interest rates and terms — so compare to see which best fits your needs.
While every lender measures risk differently, interest rates depend greatly on your credit. Do your homework ahead of time to understand your credit history to get a clear picture of what lenders are looking for and what type of terms you will be offered.
One problem with longer car loans is the fact that you often wind up “underwater” or “upside down” on your loan. This is because cars tend to depreciate faster than you can pay off your loan.
A 72- or 84-month car loan means you’re paying off your loan more slowly and have the potential to owe more than your car is worth. However, longer car loans let you secure a more affordable monthly payment, which is likely an important consideration for your budget.
The process of refinancing can temporarily lower your score. When you apply for a loan and a hard inquiry is submitted, your credit score will drop a few points. Following approval, a new loan account will lower the average age that your credit score holds which can lead to a lower score.
But these two factors are a small part of what makes up your credit score and sticking with a monthly payment you cannot afford will likely lead to larger credit issues down the road.
Refinancing does start your auto loan over, but it is not a perfectly clean slate. You will sign off on new, more competitive rates in order to save money on your monthly payments. It will make paying off the loan easier, but it is not a reset.
The number of payments on the previous loan also don’t carry over to the new one. While the amount is still paid off, you won’t have the mark of those payments on the new loan.
Some lenders will expect drivers with poor credit to put money down to provide extra security for the loan. So having cash to refinance can help by lowering the price you’ll have to pay to finance the vehicle. Though a down payment is not always required, equity — the difference in the value of the vehicle and the amount you owe — is.
Refinancing does not automatically mean you are handed a check with more cash, but you may be able to benefit from the equity you have in your car. With cash-out refinancing, you essentially finance for more than you owe so that you get that leftover money in the form of cash — along with an improved auto loan.
To determine if refinancing is worth it for you, you must consider if you will truly save money with new loan terms. For many drivers, it does prove to be worth it if their credit score has improved since they first took out their auto loan, or they originally financed through a dealership. Take advantage of an auto refinance calculator to find out if you will save money with a new loan.
Refinancing your car loan comes with risks that include potentially high interest rates and additional fees. Due to the current state of the market, it is possible you will be met with higher than usual interest rates.
A new loan means extra costs, such as application, transfer and origination fees. And if you extend your loan term, you are more susceptible to becoming upside down on your loan and paying more interest.
You technically can refinance your car loan with poor credit. But unless your score has improved since you initially signed, you will likely not receive improved terms. Instead, consider loan modification or vehicle trade-in.
To select the top refinance car loans, Bankrate considers 16 different factors. These factors range in consideration from the loan amount, disclosed APR and acceptance criteria. Each lender holds a score based on four categories.
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