Do I Need to Wait a Year to Refinance My Car?

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    • 1). Shop auto loan interests rates by visiting lender websites or by calling loan providers. Advertised rates are usually for new cars, not used. Shop interest rates until you find a lender you want to use for your refinance.

    • 2). Call your current lender to obtain your loan's payoff amount, including the loan's per-diem amount, or interest added daily, for at least 10 days. Confirm your lender doesn't charge a penalty fee for early payoff.

    • 3). Organize your vehicle information so you can provide it when applying for your refinance. Expect to provide your vehicle payoff amount, identification number, year, make, model and mileage. Check your vehicle over for features that increase the lending value of your car, such as alloy wheels, leather or a sunroof.

    • 4). Contact the lender you want to use for refinancing and explain to a representative what you're hoping to accomplish by refinancing your loan. This way, the representative can explain any savings from interest rate or term adjustment. Submit your vehicle and credit information to start the application process.

    • 5). Wait for your approval, which can take several days. Once approved, discuss the terms of your loan to ensure the interest rate, down payment requirement (if any) and term result in an affordable payment. If so, arrange to sign your loan contract.

    • 6). Submit any required information to your new lender if required, such as a copy of your pay stub or proof of residency. Review your contract and sign where appropriate. Your new lender will pay off your old auto loan and become the car's new lien holder.

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