Refinancing a car loan could be a smart financial move if you’re looking to lower your monthly payments, reduce your interest rate, or adjust the length of your loan term. While many people assume that refinancing requires switching to a new lender, it’s also possible to refinance your car with same lender.
In fact, there are several benefits to doing so. In this article, you’ll explore why you might want to refinance your car loan with the same lender and what to consider.
Lower Fees and Easier Approval
When you refinance your car loan with the same lender, you can avoid certain fees that you would otherwise have to pay with a new lender. For example, you can skip a loan application fee or an origination fee. Additionally, you may find getting approved with your current lender easier, especially if you’ve been making on-time payments on your original loan. And if you aren’t sure whether your refinanced loan aligns with your budget, you can use a car loan calculator to measure and determine your monthly payments
Familiarity and Convenience
Working with the same lender that financed your original car loan can offer familiarity and convenience.
You’ll already have an established relationship with your lender, and you’ll know what to expect from their customer service, billing processes, and loan management tools. This can make the refinancing process smoother and less stressful than switching to a new lender.
Potential for Better Rates and Terms
Refinancing with the same lender doesn’t necessarily mean you’ll end up with the same interest rate or loan terms. Depending on the current market conditions and your credit score, you might be in a position to negotiate better rates or terms with your existing lender. They may be willing to work with you to keep your business and maintain a positive relationship.
Simplified Paperwork
Refinancing with the same lender can also simplify the paperwork involved in the process. Since the lender already has your information on file, you may not need to provide as much documentation as you would with a new lender. This can save time and hassle, making the refinancing process faster and easier overall.
No Need to Shop Around
Refinancing with the same lender can be a convenient option if you’re already happy with your current lender and don’t want to switch. You won’t need to spend time researching and comparing rates and terms from multiple lenders, which can be time-consuming and overwhelming. Instead, you can focus on working with your current lender to find the best refinancing option for your needs. Lantern by SoFi states, “It’s obvious to consider your current lender, also if you’ve had a good experience.”
Refinancing your car with the same lender can offer several benefits, including lower fees, easier approval, and familiarity and convenience. You can also negotiate better rates and terms with your existing lender. However, it’s important to carefully consider your options and research before making a decision.
By exploring your options and working with your current lender, you can find the best refinancing option for your needs and potentially save money on your car loan. Keep in mind that while refinancing can be a smart financial move, it’s not a one-size-fits-all solution, and you’ll need to weigh the pros and cons to determine if it’s the right choice for you.
