How to Refinance an Acura Vehicle

Refinancing an Acura Vehicle

An auto loan refinance essentially replaces your current auto loan with a new loan. This means that you could potentially lower your payment by adjusting the loan term, qualifying for a lower interest rate, and taking advantage of other factors. What does it take to refinance your car loan?

1. Decide if Refinancing is Right for You

Auto refinancing comes with great benefits, but it is not right for all situations. Before you decide if refinancing is a smart option for you, ask yourself these critical questions:

  • Does the current loan have a prepayment penalty? How will this impact my refinancing plans?
  • What are the fees associated with transferring the title, re-registering the Acura vehicle, and more?
  • Is the Acura vehicle’s current value high enough to pay off the old loan?
  • What are the model year and mileage of the Acura vehicle?
  • Has my credit profile improved since I took out the original loan?

2. Gather the Required Documents

If you feel confident in all of your answers and believe that refinancing still makes sense for your situation, you should pull together all of the required documents. While lender requirements will vary, most require the same basic information as part of the loan application process. This includes:

  • Your Social Security or tax ID number, previous residences for the last five years, and monthly expenses
  • A copy of your most recent pay stub or previous year’s tax return to prove income
  • A copy of your auto insurance card
  • Your current loan’s interest rate, balance, and payoff date
  • The Acura vehicle identification number, as well as the make, model, and mileage

3. Get Prequalified

You are now ready to get prequalified for your next auto loan. When you apply entirely, the lender will make a hard pull on your credit report. You understandably do not want too many hard pulls because of the impact that this could have on your credit rating. When you shop around, consider asking for a prequalification. This utilizes a soft pull on your credit report, so the effect is minimal.

4. Apply for Your New Acura Loan

After finding an Acura auto loan program that you want to move forward with, you will need to follow that lender’s application instructions. The lender should then guide you through the rest of its process. In many cases, it only takes a day or two to complete the application process.

5. Pay Off the Old Acura Loan

In some cases, the new lender will pay off the old loan’s balance directly. In other cases, you will be given a lump sum of cash from the new lender, and it will be your responsibility to pay off the existing loan balance. Ensure that you continue making payments on your old loan until you have confirmed that the balance has been paid in full.

Are you still trying to decide if refinancing your auto loan is a smart move? Consider shopping around to explore your options. When you have a firm understanding of the possibilities, you can make an educated decision about how to proceed. Contact Acura of Jackson for further assistance.