How Refinancing Your Car Can Save You Money
How Refinancing Your Car Can Save You Money
Most Australians know that they can refinance the loans on their homes. However, did you know that you can also refinance the loan on your car? This process works out just like a home loan refinance. You apply for another loan with different terms and it replaces your existing car loan.
While this move makes sense for many Australians, far too few get this good financial advice. Here are a few common situations when refinancing your car can save you a good amount of money.
Receive a Better Loan for a Better Credit History
Building a credit history takes time. As a relatively young driver, chances are your score wasn’t that strong when you took out your loan. This means you’re paying more in monthly interest than older drivers with a longer history.
One of the best ways to build a credit history is by making your car payments. Have you been on time with all your bills for the past year or two? If so, it would make sense to refinance because you would almost certainly qualify for a better rate and a less expensive loan.
Take Advantage When Interest Rates are Low
Car loans base their interest rates on the market interest rate. When the Australian rate is high, loans are more expensive. When the market rate is low, loans become cheaper. Did you take out your loan during a time of high interest rates? Have rates fallen since then? Then you are paying too much for your car loan. Take out a car loan refinance, take advantage of the lower rates, and enjoy the lower monthly payments.
Lower Your Monthly Payments by Switching to a Longer Loan
Are you having trouble making your monthly car payments? Are you worried that you might start missing payments in the near future? This is a serious problem. Missed payments damage your credit history and if you miss too many, you’ll lose your car as well. A refinance can get you out of this jam.
You can lower your monthly payments by taking out a longer loan. For example, you could switch reduce your monthly bill. The problem with this move is that you’ll end up paying more in total interest over the longer loan. However, this is much better than ruining your credit or losing your car.
While a car refinance isn’t for everyone, when it works this move can be a big money saver. If you think a refinance might be right for you, contact Platinum Direct representatives today to learn more about your options.
