It is important that you have a reliable mode of transportation that can get you to work or school each day. Without reliable transportation, you could fall behind in school or lose your job because you can’t get to the office on time.
What are some auto title loan refinancing options that you have to make your car payment as affordable as possible?
Extend the Loan Term
Those who are having a hard time making their payment each month should consider extending the term of the title loan. This will spread out the remaining loan balance over a larger number of payments.
Although you may have to pay more interest on the loan, you won’t run the risk of missing a payment because you don’t have enough money in the bank when the payment is due.
Shorten the Loan Term
If you are trying to pay off your auto title loan as soon as possible, it may be a good idea to refinance your loan to a shorter loan term. While the monthly payment will be higher, you will pay off more of the principal balance and build equity in the car at a faster rate.
Attempt to Lower the Interest Rate
Borrowers who have made payments on a consistent basis may see their credit score improve greatly.
Once a borrower’s score improves sufficiently, that borrower may be able to secure a lower interest rate when refinancing his or her car loan.
Therefore, if you have been making payments on a regular basis, you may be able to refinance your title loan and pay less interest over the remaining life of the loan.
Lower Your Debt-to-Income Ratio
For some people, extending the term of their auto title loan may be about more than just trying to lower their monthly payment. Instead, the goal of refinancing a loan is to lower their debt-to-income ratio.
If you are trying to get a mortgage or acquire another loan, a lender is going to scrutinize your DTI.
By lowering your monthly payment, it may help you come across as a better loan risk to other lenders.
Refinancing Is Easy
Regardless of why you want to refinance your title loan, it is easy to do so. If you are not happy with your current auto title loan, you can make changes at any time.