A lot can happen from the time you first finance a vehicle to the time you pay it off. If you’re curious about getting better rates now or a lower payment, you may want to refinance. Our Mercedes-Benz finance team at Mercedes-Benz of Romeoville is providing an overview of how it works.
What Does Refinancing Entail?
To refinance an auto loan, you’ll need to apply for a new loan to replace your old one. We’ll need to collect information about your employment, income, and expenses. We’ll also pull your credit. Then, we’ll give that information to our network of lenders to get offers for a new loan.
The Benefits of Refinancing
If your credit has improved, you’ll likely get better rates on your new auto loan. This means that you’ll pay less interest and spend less overall on your vehicle. You can use the balance to reduce your monthly payment to a more manageable amount, or you can opt to pay off your loan sooner, if you prefer. This is also an opportunity to remove a co-signer if you have one.
When to Avoid Refinancing
While refinancing comes with many perks, it isn’t always a good idea. If you’re significantly upside down in your loan, it may be hard to get approved for refinancing. Refinancing also isn’t the best idea if your credit has declined, because it can result in a higher interest rate, meaning your payments could increase, and you’ll pay more for your vehicle overall.
Refinance Your Auto Loan in Romeoville, IL
Whether you’re interested in refinancing or want to consider a new vehicle, we can help. We’re happy to review your options with you to see which is best for you. Visit Mercedes-Benz of Romeoville to get started today!
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