7 Best Auto Refinance Companies

Are you ready to refinance your car or truck for a better rate? Doing so is a great way to lower monthly payments and save on your insurance. In fact, according to a 2022 report by RateGenius, borrowers with stellar credit knocked almost 7% off their rates, on average. That can save a lot of money over the life of a car loan. But with so many options to choose from and so many variables to consider, picking the right company is a massive undertaking.

As we put this comparison together, we relied on interest rate figures published by the lenders themselves. But readers should note that these rates can and do change. It’s a good idea, then, to double-check the rate on your loan with the lender you select before finalizing the deal.

If you’re not sure who to refinance with, read on to see the seven companies we recommend.

Our Top Auto Refinance Picks for 2022

• Lightstream: Best for Good Credit
• MyAutoLoan.com: Best for Fair Credit
• Auto Credit Express: Best for Poor Credit
• PenFed: Best for Low Auto Refinance Rates
• AutoPay: Best for Variety of Refinance Options
• LendingTree: Best for Marketplace
• rateGenius: Runner Up for Best Marketplace

Why we chose it: Lightstream is an excellent choice for borrowers with excellent credit because of its lack of vehicle restrictions, low rates, and Loan Experience Guarantee, which are features that not all financial institutions provide.

The loan offered by Truist Bank, previously known as SunTrust bank, allows those with excellent credit access to some of the best rates on the market. However, the bank performs a hard credit pull on all applications, unlike other banks that do a soft pull to prequalify borrowers first.

Applicants can receive same-day funding and fixed, low-interest loans when they meet the credit requirements. And if you’re not satisfied after finalizing the loan, Lightstream offers a Loan Experience Guarantee with a $100 reimbursement.

This company stands out by providing its borrowers with low rates and flexible vehicle standards. As a result, you’re able to refinance on all kinds of cars.

Why we chose it: Since they’re a broker, MyAutoLoan.com gives applicants with fair credit competitive rates and a range of financing options. Unlike the banks on this list, they partner with other companies to find the lender that will give drivers the best deal.

A minimum credit score of at least 575 is required to apply. But there is no application fee.

With a minimum loan amount of $8,000 and a hard credit inquiry, you’ll want to ensure you’re serious about auto loan refinancing before applying.

There’s also a minimum annual income requirement of $18,000.

Why we chose it: Auto Credit Express focuses on helping low credit borrows connect with auto refinance lenders who work with poor credit, making it one of the few auto lending companies to do so.

Auto Credit Express helps poor-credit applicants get better auto loan interest rates, including borrowers who have underwater loans.

While a score of 580 is recommended, borrowers with any credit score can apply. And Auto Credit Express offers a vast library of resources for those looking to learn more about lending before applying to refinance a vehicle.

Why we chose it: Pentagon Federal Credit Union is a great choice for low-rate financing, with rates as low as 1.79%. That’s lower than what most banks offer. On top of that, the credit union also offers some nice incentives for borrowers, such as zero prepayment penalties and rate discounts.

The credit union offers its members some of the best rates for auto refinancing in the industry. If you have a new car, you could pay as little as 1.79% in interest. If you have a used car, rates can be as low as 2.39%.

To become a member, you must open a savings or share account. You then must deposit $5 or more. Membership is a requirement to refinance, but it is open to the public.

The credit union offers Guaranteed Asset Protection (GAP), which provides an extended warranty and debt protection for your car. And if your vehicle is from 2020 or later and you’re the first owner, you can qualify for a new car refinance loan.

For a limited time, PenFed is offering a $150 cash bonus when you refinance a car. If you opt-in during this time, you will receive the bonus within 90 days of the start of the loan.

Why we chose it: Autopay has a wide network of lenders and works to connect them to borrowers with a variety of credit scores. In fact, Autpoay has the largest selection of refinancing options available on our list. You’ll be able to work with them to find lending options that work for you.

If your credit score is 600 or above, you’ll be able to work with Autopay and access its different loan offers, including cash-out refinancing and lease buyouts.

They also offer reduced rates, lower monthly car payments, or shorter loan repayment terms if your credit score has improved since taking out your original car loan.

Keep in mind that Autopay will pull a soft credit check, which won’t affect your score while you’re looking at different options. However, once you choose an option, the lender will verify your credit with a hard pull. If there are discrepancies between the hard and soft credit checks, the terms may change.

Why we chose it: LendingTree was a clear winner in this category because it offers unique tools and resources to help borrowers compare options and simplify the refinancing process.

LendingTree is a financial marketplace and a great place to start looking for auto refinance loans. You can compare a wide range of financial products on their site. They make it especially easy to compare different lenders with their Auto Refinance Rates comparison tool. Just input your credit score, loan amount, and zip code to get offers specific to you.

Not sure which company to choose? LendingTree helps borrowers make decisions by providing individual reviews of the lenders along with educational resources to help during the refinancing journey.

If you’re still having issues, you can reach out to LendingTree’s customer support team and ask any questions you have about the potential lenders.

Why we chose it: We don’t normally choose runners-up in our reviews, but rateGenius’s unparalleled customer satisfaction and support convinced us to make an exception in this case. Their team makes refinancing go smoothly. And with over 150 lenders to choose from, you’re likely to find the terms you want.

rateGenius also helps users find refinancing that’s close to their original length terms, so you don’t end up paying more over the life of the loan. As a rate comparison site, the company allows you to look through multiple companies and find the one that fits.

If you find the right company for you through rateGenius, their lending specialists will help you complete the application process. However, it can take up to 48 hours for your application to be approved, and they will perform a hard credit check at the beginning of the process. Once a loan is approved, the company will ensure your old loan is paid off and your new loan is set up correctly.

Other auto refinance companies we considered

OpenRoad

In order to make our list, companies have to accept all car makes and models. Their vehicle requirements must also be lenient. OpenRoad failed to do this.

Capital One

Capital One didn’t make our list for the reasons above, but also because the company might require you to pay down your current loan before refinancing in some instances.

Bank of America

Bank of America offers favorable terms, but only to qualified applicants. Since they’re stringent on applicants and the state of the car, we decided that they didn’t make our best auto loans list.

Lendingclub

Lendingclub works with a wide range of credit scores. But because of their vehicle requirements and the high APRs, we opted not to include them on our list.

Auto Approve

Auto Approve has some great loan options for auto refinancing, but it doesn’t have any standout features to highlight as a top pick.

RefiJet

RefiJet is another company that has flexible credit score requirements. However, we did not include them because they limit the types of cars you can refinance.

Auto Refinancing Guide

If you’re ready to refinance, make sure you consider all your options. It’s important to remember that this isn’t a decision to be taken lightly. While you can get better rates if your credit has improved since you initially financed your vehicle, your credit score will temporarily drop due to the hard pull lenders make to ensure you are creditworthy. Read on to learn more.

How does refinancing a car work?

Refinancing a car works one of two ways. You either obtain a traditional refinance or a cash-out refinance.

Traditional refinancing is relatively straightforward. You obtain a new loan to replace the terms and conditions of your old loan. You’re most likely going to get a reduced APY, which saves money. If you opt to take out a shorter-term loan, you’ll save money this way as well.

Cash-out refinancing is a bit more complicated, which is why fewer companies offer it. With this refinancing option, you will receive more money than you currently owe on your original loan. You can use this extra money as you see fit. This option is cheaper than a personal loan or credit card, but the monthly payments on your vehicle will be higher.

Pros and Cons of Auto Refinancing

It’s important to consider all the pros and cons when refinancing your vehicle.

When can you refinance a car loan?

It can be tricky to decide when to refinance your vehicle. Generally, you should refinance in one of three situations.

1. Your terms aren’t great. If you think you could get better terms by refinancing, then it’s not a bad idea to shop around for the best rates.
2. Your credit score has gone up. Improved credit scores can get you better rates than your current lender’s terms. Improving your credit score before you shop around for better interest rates will help ensure you get the best terms.
3. Your current auto loan payments are too high. If you cannot afford your current payments, refinancing them with longer terms will help ease the financial burden.

How to refinance a car loan

If you’re ready to refinance, follow these simple steps to start the process.

7 steps to apply for auto refinance

1. Check the health of your credit
2. Gather all information about your existing auto loan
3. Research new lenders and compare rates
4. File for prequalification
5. Submit an application
6. Evaluate the terms
7. Finalize the loan

Documents Needed

Collecting the documentation you need before you begin will help streamline the process. You’ll need the following:

• Social security number
• Employment information
• Residence information
• Driver’s license
• Car registration and mileage information
• Proof of insurance

How to refinance your car loan with poor credit

Bad credit can be a major hindrance when refinancing your vehicle. If your score is below 640, getting the best rates probably won’t be possible. That doesn’t mean you shouldn’t refinance; you’ll just need to be more careful.

Check and see if the auto loan rates have gone down. If they have, you might be able to snag a lower interest rate with more favorable terms.

Using marketplaces such as LendingTree and rateGenius to help find loans you prequalify for will help your search immensely. And if you can refinance with a cosigner, you’re more likely to get the terms you want.

If you can, consider trying to fix your credit score. Compare both your Vantage Score vs. your FICO score when looking at your credit score as a whole.

If there are any errors in your reported credit history, you can petition the credit reporting agencies to remove them from your report, thus improving it. Even if there are no errors, there are still ways to remove negative items on a credit report. 

You might consider debt consolidation or credit repair as another option. Look into the best credit repair companies, and choose the one that best fits your situation.

How We Picked the Best Auto Refinance Companies

When deciding which companies made our list, we considered several things.

We looked at companies with competitive interest rates, low fees, and flexible (or no) vehicle restrictions. On top of that, we made sure each company was financially stable. We also looked at their private policies and favored companies with high transparencies.

Summary of the 7 Best Auto Refinance Companies of 2022

• Lightstream: Best for Good Credit
• MyAutoLoan.com: Best for Fair Credit
• Auto Credit Express: Best for Poor Credit
• PenFed: Best for Low Auto Refinance Rates
• AutoPay: Best for Variety of Refinance Options
• LendingTree: Best for Marketplace
• rateGenius: Runner Up for Best Marketplace