When Is the Best Time to Refinance Your Auto Loan?

Video Transcript

"Hi, this is Matt McKillen with Innovative Financial Group. The question posed to me today is 'when is the best time to refinance your auto loan?'. It's a little bit of a tricky question. I think really what relates best is that if you're in a lease situation on a vehicle, and generally you can have a lease on a vehicle from anywhere from twelve months up to sixty months, usually 36 months is the average lease. At the end of a lease, you're basically renting your car for a period of time from the dealer. At the end of the lease, there's usually a balloon payment that's due, so you have a couple of different options. You can either turn the car back in, and possibly re-lease the vehicle, or what a lot of people do is, they like their car, they've have it for a couple years, they actually will go out and refinance that lease into a traditional auto loan, where they can have a set term of repayment for maybe anywhere from three to five years, and actually pay off the balance of the lease that's owed. And then they can get into an installment loan, with either their bank or their credit union, to pay back the amount that was sent to the dealer to pay off the lease. So that's really my idea of the best example of the best time to refinance an auto loan. My name is Matt McKillen, I'm with Innovative Financial Group."