Improving your credit score may be enough to get a lower rate. The difference between applying for a loan with good credit and applying with bad credit is significant. For many auto loans, it can mean an APR that is more than 10 percentage points lower. That could mean major savings on your monthly payment and total interest costs.Next step: Check how much you could save by refinancing your auto loanYour total savings would be about $39 a month — but you would reduce the total interest you pay by $1,865.Ass ...

Core Insights - Auto loan refinancing presents significant savings potential for consumers and opportunities for lenders amid persistent inflation and elevated interest rates [1][4] - Approximately 18 million out of nearly 80 million open auto loans in the U.S. are considered "in-the-money" for refinancing, indicating strong candidates for financial benefits [2][4] - Average monthly savings from auto loan refinancing have decreased from $107 in 2021 to $90 in 2024, yet remain substantial for many consumers [3] Consumer Behavior - More than half of consumers surveyed would consider refinancing if they could save between $50 and $149 per month, highlighting a strong motivation for cost-saving measures [3] - The number of consumers eligible for refinancing could increase significantly if the Federal Reserve lowers interest rates, with a potential rise to nearly 20 million with a 25-basis point cut [4] Loan Performance - Consumers who refinanced their auto loans showed a lower likelihood of being 60 or more days past due by 170 basis points compared to those with original purchase loans, with a 320 basis point improvement noted among near prime borrowers [6] - Auto refinance loans are outperforming original purchase loans across all credit tiers, indicating a consistent trend of stronger repayment behavior [5][6] Market Opportunities - Lenders are encouraged to target qualified borrowers for refinancing opportunities, as those who refinance tend to be more financially savvy and proactive in managing their credit [7] - Utilizing tools like TransUnion TruVision LTV prescreens can help lenders identify consumers in specific equity positions for refinancing offers, enhancing marketing strategies [7]