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In many cases, this will depend on your LTV (“loan-to-value” ratio calculated by dividing your loan amount by your car’s current value). If your ratio is under 125%, you have a very good chance of getting refinance offers. Keep in mind that you’ll need to meet the minimum balance (about $5,000) and maximum mileage requirements (under 100,000 miles).
Also, if you have struggled with credit in the past, it may help to lower your LTV. You can do this by making on-time payments or making extra payments to get your LTV to under 125%.
No. When you sign up with Pacecar, we run a “soft” credit pull. This is different from a “hard” credit pull like signing up for a credit card. A “soft” credit pull does show up on your credit history, however it is not considered a “negative” mark and therefore will not hurt your credit score in any way.
Most lenders require a minimum loan balance before providing a refinance offer. In general, most lenders require your loan balance to be above $5,000, however some lenders require a balance of $7,500. Unfortunately, this does mean that if your current loan is less than $5,000 you will not be eligible to refinance your can loan with Pacecar.
Lenders typically have a maximum mileage requirement. This means that if your car is over a certain number of miles, they will not be able to offer you a refinance deal. The maximum mileage varies by lender but in general, your car will need to have less than 100,000 miles.
It’s frustrating to admit, but most dealers make money off of financing. In fact, dealers are allowed to earn “participation” by marking up the APR of your loan by a few percentage points.
For example, let’s say you bought a car 11 months ago for $25,000 and you put $2,000 down. If you live in a state with a 5% tax and are paying an 8% APR on a 60-month contract your payment is $532. The 8% rate likely includes a dealer markup, which is profit the dealer books today that you end up paying over the course of your loan. Most dealers allow markup of between 0% and 2%. If your dealer added a 2% markup to that deal, it translates to $1,486 of profit for the dealer and about $25 extra dollars per month to your payment.
When you refinance with Pacecar you can get rid of those extra percentage points and only pay what you owe. Most of our users save about $100 per month.
You may be overpaying for your car loan. That means that each month your payment is higher than it needs to be. When most people refinance, they see meaningful monthly savings.
The best part? Pacecar charges you no fees. We get paid by our lenders. So why not save a little money?
In some instances, it makes sense to refinance your car loan more than once. As you make monthly payments, your car’s LTV (“loan-to-value” ratio) is improving which means you can be saving more money.
The best part about using Pacecar is that from the time you sign up, we’ll continue to find you refinance offers even if you’ve refinanced. So make sure to check your dashboard every few months to see if refinancing again makes sense for you.
At Pacecar, we are all about saving you money. That’s why we will never charge you a fee for using our services. We get paid from the lenders we work with.