The following will offer insight into how to refinance a car loan in spite of having bad credit, such as:
Phoenix, AZ -- (SBWIRE) -- 05/23/2013 -- Show a Good Payment History
No lender will refinance auto loans with bad credit unless the borrower can show that he has a positive payment history on his current loan. Being able to prove that one has the ability to make steady loan payments increases one’s likelihood of being approved for a refinance loan. Skipping or being late with monthly payments results in being denied the refinance loan.
Know What the Auto is Worth
It’s important to know a car’s current value when learning how to refinance an auto loan with bad credit. If the car is worth less than the amount one owes on the original loan, it won’t be possible to get a refinance. An individual can find the value of his automobile by checking the Kelley Blue book, the official index of vehicle worth. He can also go online and type in the year, make, model, and mileage of his car to find out its worth.
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How Much is Owed?
Borrowers who want to refinance bad credit auto loans must know the exact amount of money owed on their current loans. An incorrect total may result in paying too much back when the refinance goes through. To find out the loan balance, simply contact the lien holder and ask. It can also be found at the end of one’s loan statement. Be sure to bring documentation of the amount owed so the financer, if different from the original lender, can see exactly what’s due, and can tabulate the refinance loan.
Compare Terms and Rates
Once one has proof of good payment history, knows what his vehicle is worth, and can prove how much is still due on his original loan, he must take the next step: researching and comparing interest rates and loan terms. To effectively refinance an auto loan with bad credit, check several lenders to see where the best deal is. Look for the lowest rates offered to folks who have bad credit, as this will influence one’s monthly payments.
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