Don’t stick with a loan that’s not working for you. Instead, refinance an auto loan.
MyAutoLoan is a fast and easy online loan aggregator. With competitive interest rates and varied loan terms, myAutoLoan is our pick if you want to compare options for a refinanced loan.
One of the advantages of getting a loan through a traditional bank is its reliability. Bank of America (BoA) has been in business for 240 years and has been Better Business Bureau (BBB)-accredited since 1949.
It’s very common to take out a loan to finance a new car purchase. Unfortunately, the stress of the car-buying process sometimes results in a less-than-ideal loan structure. Luckily, refinancing your vehicle can offer relief in the form of lower interest rates, lower monthly payments and a shorter or longer loan term, depending on your needs. We found the best loan providers and aggregators to supply a refinance loan for your vehicle.
Best Auto Loan Refinancing Overall: myAutoloan
Best Bank for Auto Loan Refinancing: Bank of America
Best Auto Loan Refinancing for Bad Credit: AUTOPAY
Best Auto Loan Refinancing Interest Rates: LendingTree
Best Credit Union for Auto Loan Refinancing: Digital Federal Credit Union
|Auto loan provider||myAutoLoan||Bank of America||AUTOPAY||LendingTree||Digital Federal Credit Union|
|Best for||Overall||Bank||Bad credit||Interest rates||Credit union|
|Age of the company (in years)||19||240||16||26||43|
|Loan provider or aggregator||Aggregator||Loan provider||Aggregator||Aggregator||Loan provider|
|Life of the loan in months||24-72||Not disclosed||24-96||12-84||36-84|
|Minimum annual percentage rate (APR)||1.90%||3.89%||2.99%||0.99%||3.24%|
|Minimum and maximum loan amount||No set amount, but minimum loan amount for refinancing is $5,000||Minimum $7,500 or $8,000 in Minnesota||$2,500-$100,000||Varies by lender, but up to $4 million or a maximum loan-to-value (LTV) ratio of 125%||Up to 130% of car’s value|
|BBB rating (A-F)||A+||A+||A+||A+||A+|
|Trustpilot rating (out of 5)||4.2||1.3||4.8||4.6||2.2|
There are a few reasons to consider refinancing. Here are four signs that it may be time to secure a new loan:
A subsidiary of Horizon Digital Finance, myAutoLoan is a privately held, direct-to-consumer online marketplace that connects consumers to auto and motorcycle loans. The online company aggregates terms from multiple lenders so that you can compare offers in up to 4 minutes. One of the main benefits of myAutoLoan is its user-friendly website, which provides convenient access to loan information from several vetted lenders.
To refinance your car with myAutoLoan, you must have already had a loan for at least six months and have three years of credit history. Depending on the lender, there may also be income requirements, typically gross annual earnings of at least $18,000. Before you refinance, consider whether your credit score is where it should be for you to secure a lower interest rate than your original loan. myAutoLoan requires a FICO score of 575 or higher.
MyAutoLoan gives applicants up to four lender matches with a soft credit check and the lowest daily rates for refinancing loans. As of Jan. 31, 2023, the lowest refinance auto rate is 2.49 percent. Most lenders provide approval within 30 seconds of application submission and the funds to pay off your previous lender within 24 hours. With multiple lenders, you can find one that fits your specific situation, for example, if you need a cosigner.
MyAutoLoan receives an A+ rating from the Better Business Bureau (BBB) based on the lender’s accreditation and business practices. The company received its BBB accreditation in 2003.
In addition, its Trustpilot review score is 4.1. Many of its five-star reviews on Trustpilot indicate the ease of the application process and the availability of multiple offers. Negative reviews note that myAutoLoan shares your information with lenders who may contact you separately, however.
Bank of America is the second-largest banking institution in the United States.1 It saves clients an average of $60 per month on their auto loan payments through refinancing. Bank of America’s online, no-fee application takes minutes and most applicants get credit decisions in 60 seconds. Furthermore, Bank of America lets you refinance whether your existing loan is through Bank of America or another financial institution.
Some lenders subject you to a prepayment penalty for paying off your loan early, but not Bank of America. If your current loan has a prepayment penalty, the amount you save by refinancing with Bank of America may be significantly more than the penalty. In that case, refinancing may still be a good idea.
If the interest rate you qualify for is significantly lower than your current loan rate, it may be the right time to refinance. Bank of America sweetens the deal for Bank of America Preferred Rewards or Preferred Rewards for Wealth Management customers, who qualify for interest rate discounts of up to 0.50 percent.
Bank of America’s Preferred Rewards program is one of the reasons we picked it as one of the best auto loans for new cars. Membership is available in all 50 states, including Washington, D.C.
Bank of America’s easy and fast process requires you to provide the following information online for the loan approval in 60 seconds:
After approval, you’ll have 30 days to think about the offered amount without losing the interest rate, which is locked in at the time of your offer.
Based in Denver, AUTOPAY specializes in auto refinancing and new purchase financing. Apply for a refinanced loan in minutes to save an average of $105 on your monthly payments. With AUTOPAY, you can apply for a traditional refinancing loan, receive cash back to consolidate debt or pay off your lease early with a lease buyout. The company works with customers across the credit spectrum to find fair rates.
AUTOPAY offers three refinancing options, each with its own benefits. Not all lenders and aggregators do cash back and lease buyout options for refinancing, so AUTOPAY’s three options provide more flexibility for unique situations:
Just as not all lenders provide cash back and lease buyout options, not all lenders and aggregators offer beneficial terms to people with bad credit. AUTOPAY helps people with no, inactive or low credit find auto loans. Here are the steps to finding a lender through AUTOPAY if your credit score is not as high as it could be:
Like most aggregators, each lending partner has different approval criteria; this is how AUTOPAY provides financing solutions for people with good and bad credit.
AUTOPAY has a convenient auto refinance calculator on its website to give you an estimate of how much refinancing will save you. Last year, AUTOPAY saved borrowers an average of $1,158 refinancing their car loans and lowered APRs by 50 percent.4 Here’s what you need to get started:
LendingTree is an auto loan aggregator that allows you to compare lenders and rates. The company offers the lowest minimum APR we’ve seen at only 0.99 percent, making it one of the best auto loan aggregators for new car owners. At the same time, LendingTree offers multiple options for refinancing to lower your payment or APR or pay off your loan faster, including cash-out auto refinancing.
LendingTree’s minimum APR is 0.99 percent, the lowest we’ve seen across loan providers and loan aggregators. If you have good credit and a high income, LendingTree is an easy win. A shorter loan term with a low APR is the best option financially, so you can accrue less interest and pay the loan off more quickly. Your credit score is the biggest determining factor of APR, so if you have low credit, your APR will be higher.
Your loan amount depends on your provider, but LendingTree provides quotes for up to $4 million, which is more than enough for the average driver in the U.S. This is also known as the LTV ratio.
Some of LendingTree’s providers offer up to 125 percent LTV, meaning if you total your car, you’ll receive 25 percent more than its current value to pay for a new car. Gap insurance is another way to cover the remainder of your auto loan if you total your car and it’s usually required if you have a loan or lease your vehicle.
Below is a rundown of the top five lenders that LendingTree recommends for auto refinancing. The company will do the legwork of getting your quotes from the appropriate lenders, but this information may be helpful as you compare quotes from multiple companies:
Digital Federal Credit Union, also known as DCU, is a member-owned not-for-profit financial cooperative. DCU serves more than 1 million members and families in all 50 states. Headquartered in Massachusetts, DCU is one of the 20 largest credit unions nationwide.5 It offers consumer banking and lending as well as business banking, business lending, auto insurance and realty services.
DCU offers the following discounts and benefits with its refinance loans:
Here’s a breakdown of membership options with DCU ― the more a member does with DCU, the more these benefits apply:
The longer your loan term, the lower your monthly payment. See below a chart showing loan terms, APR and estimated monthly payment (SMP) available with DCU.
|Maximum term in months||Lowest available APR||EMP per $1,000 loan|
To compare refinancing options, we looked at information provided by the companies as well as third-party ratings from the BBB and Trustpilot, which aggregates customer reviews online. Your exact loan offer will depend on your vehicle and credit history. Some of the factors we analyzed across the five companies include:
Refinancing an auto loan works by replacing your current auto loan with a new one. The new loan pays off your original loan, and you make monthly payments on the new loan instead. Traditional refinancing reduces your monthly payments or interest and shortens your loan length. You can also receive cash back or lease buyout refinancing options from some lenders.
To qualify for auto loan refinancing, you need the following:
You should wait at least six months before refinancing an auto loan. Often, lenders have a waiting period or require the current lender to possess the car’s title, which can take several months to transfer.
The fee for refinancing an auto loan depends on the lender. MyAutoloan, Bank of America and AUTOPAY do not charge fees for refinancing. However, with LendingTree, an aggregator, some of its lenders may charge fees. Caribou, for example, has a steep $399 fee.
Most loan providers and aggregators can get you a quote with a locked-in interest rate as soon as 24 hours after you apply.
Large Holding Companies. Federal Financial Institutions Examination Council National Information Center. (2022, Sep 30).
When to Refinance a Car (and When to Wait). LendingTree. (2021, Aug 27).
Is loan refinancing right for you? Bank of America. (2023).
Refinance your auto loan. AUTOPAY. (2023).
Our Story. Digital Federal Credit Union. (2023).