There are many reasons why refinancing your car loan can be a smart financial move. Maybe you think you can lower your interest rate. Or, your financial situation may have changed and having lower monthly payments would help you address other financial obligations. Perhaps you want to add or remove a co-borrower. Maybe some unforeseen circumstance means that having more money in your pocket each month would make a big difference. Whatever the reason, it makes sense to investigate the refinancing option to understand your options and understanding the steps for getting your vehicle refinanced.
4 Key steps for getting your vehicle refinanced
The first and arguably the most important step in the 4 key steps for getting your vehicle refinanced is research. You probably did some research before you purchased your vehicle. It’s also smart to do some research when you are considering refinancing. Like any financial transaction, it’s important to work with a company that has a strong reputation for top quality customer service, an easy application and contracting process, secure protection of your data, and the ability to offer you multiple options, both for your actual loan and for additional products that can help address potential financial risks associated with your both your vehicle and your loan.
You can do this research by searching major internet sites like Google or Facebook for other customers’ feedback, checking with the Better Business Bureau to make sure that you are dealing with a reputable company, and evaluating reviews and recommendations on third-party refinance websites like Lending Tree. You can also check your credit score (many credit card companies have a free credit score check as part of their service such as Discover and Barclaycard) to see if it has changed since you got your loan, which will give you a good idea if you are likely to qualify for a lower rate or be able to add/subtract a co-borrower.
It’s good to know if the refinance company/lender uses a “hard pull” to check your credit, which shows up on your credit bureau report, or a “soft pull,” which doesn’t. Make sure to research each lender’s fee structure to fully understand if there are any fees associated with the refinancing and, if so, how much. You’ll need to factor those additional fees into your overall financial evaluation of your options.
2. GATHER YOUR DOCUMENTS
To process a refinance loan, you need to provide the same type of documentation you provided with your current loan.You are almost always going to need to provide the following documents:
- Your driver’s license
- Vehicle registration – The current registration for the vehicle you are planning to refinance
The vehicle’s VIN (vehicle identification number) is a 17-digit identification number that is unique to your specific vehicle. You can find it by standing outside of your car, on the driver’s side and looking at the corner of the dashboard, where it meets the windshield. The VIN might also be shown on your auto insurance card – just make sure the card is the right one for the specific vehicle you are refinancing.
- Proof of insurance – You’ll need to provide a copy of your current insurance card
- Your current loan information – The last bill/statement from your current lender should have the information you’ll need
In addition, you might be asked to provide additional documentation such as:
- Proof of income – Your last 2 paystubs is a good place to start.
- Proof of residence – Generally, a mortgage or rent statement in your name will be sufficient.
- The vehicle title – If you live in Kentucky, Maryland, Michigan, Minnesota, Missouri, Montana, New York, Oklahoma or Wyoming.
Make sure that you work with a company that gives you a secure way to provide your private information and documents. In some cases, you will be able to securely upload copies of these documents. Some refinance companies/lenders require you to send them in. If a lender asks you to text or email them documents with your personal information, you should request a secure file transfer method like uploading the files directly to a secure website. Text and email may not be secure and therefore could be putting your personal information (and identity) at risk.
You won’t know exactly the type of refinance loan for which you will qualify unless you actually apply. With RefiJet, for example, you can provide some basic information by phone, then find out within minutes the options for which you qualify while only using a “soft pull”, which doesn’t show up on your credit report.
4. EVALUATE YOUR OPTIONS
When comparing your options, it’s optimal to consider how well the refinance loan itself will meet your needs, but also consider other aspects of the transaction:
- Partner: Reliability and reputation of the refinance company/lender
- Fees: Does the refinance company/lender add any extra fees that drive up the cost of your refinance?
- Deal structure: Interest rate, loan term, monthly payment, down payment (if any), etc., prepayment penalties
- Protection: Is high-quality GAP and/or Extended Service Contract available to help minimize financial risks. A comprehensive GAP protection policy, like the one you can get through RefiJet, covers you up to 150% of your vehicles retail value in the event of a total loss and even pays your deductible up to $1,000 so that you don’t forfeit any coverage. An Extended Service Contract on your engine, transmission, and even your hi-tech electrical components covers you, so you don’t have to pay for these standard maintenance items.
- Security: If you are giving private data (such as your social security number) on a call or email (don’t do that), make sure that the company educates you about the steps they take to protect your data, such as recording all calls, having you consent to credit bureau pulls, making the appropriate disclosures, providing a secure method to provide you documents, and providing a secure method for your sign and return of your personal documents (like your driver’s license and insurance card) as well as your loan documents.
- Process: How much work do you need to put in to process the application and provide all the supporting documents vs. how much does the refinance company/lender handle for you?
At RefiJet, we pride ourselves in providing a fast, simple, reliable, safe and customer-focused process to help you find the best refinance loan to meet your needs. We will help you through all the steps for getting your vehicle refinanced. We will explain everything to you as we go and can complete the process within a couple of phone calls. We check your credit through a soft pull, so nothing will show up on your credit bureau report or affect your credit score. We will fill out the forms for you to save your valuable time, and we provide secure methods for the transfer of your data both to and from us as well as to and from the lender.
We would certainly encourage you to explore your refinance options with RefiJet at 1.800.260.5355 or go to www.RefiJet.com, but even if you don’t, please use this checklist of steps for getting your vehicle refinanced to make sure that you are getting the best deal for you and that your personal information stays secure.