How does the length of my current auto loan term impact my ability to refinance?
Curious about Auto refinance
The length of your current auto loan term can impact your ability to refinance in a couple of ways. If you have a shorter loan term, say 36 months, you may have a higher monthly payment but will pay less in interest over the life of the loan. In this case, refinancing may not make sense unless you can lower your interest rate significantly.
On the other hand, if you have a longer loan term, say 60 or 72 months, you may have a lower monthly payment but will pay more in interest over the life of the loan. In this case, refinancing to a lower interest rate could help you save money over the life of the loan, even if it means extending the loan term.
However, it is important to keep in mind that extending the loan term could also mean paying more in interest over time, so it is important to carefully consider the potential impact on your finances before deciding to refinance.