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What auto refinancing is and how auto refinancing saves you money. Why you should consider auto refinancing, even if you have a low APR now. How to run a credit check to get your credit score before refinancing an auto loan. How to increase your chances on getting approval on a car refinance. How to get out of paying 21% APR to 25% APR. How to get your credit report, cleanup bad credit, debt consolidation loans & budget tips. myAutoloan.com - Offers qualified applicants up to 4 online car refinance loan offers in minutes. How to lower your current car loan payments If you got suckered into a high APR car loan, or even got a decent rate on your car loan, you can refinance your car loan down to a lower rate and save money. Lenders like Up2Drive and myAutoloan.com are offering popular auto refinancing loans. They pay off your current car loan and you pay them back at your new lower APR rate. Your loan can be completely refinanced within days after you apply. Do your friends a huge favor. If you know anyone who is paying a high APR car loan, have them read this article, you'll save them thousands and you'll be their hero. Credit Crisis Alert Due to the current condition of the financial markets, many people were forced into high APR car loans. If you are in this boat, you should apply for refinancing at sites like Up2Drive or myAutoloan.com. You might be able to significantly lower your APR and monthly car payments. The scary truth about your credit score Your credit score has more of an effect on your life than you think. A bad credit score can cause you to pay much higher loan interest rates, and can adversely affect your ability to get a job and cause you to pay higher insurance premiums. Many people are unaware that insurance companies check your credit before selling you insurance. Fact: You don't need an appraisal to refinance your car loan Many people erroneously believe an appraisal is required to refinance their auto loan. Unlike your home, which does require an appraisal because it is based on your equity in the home, auto refinancing is based on how much you need to pay off your current car loan, not on the value of the car. How To Get Your Credit Report If you are going car shopping, get your credit report instantly online right now so you'll have it and apply for car loans online now so you'll know now whether you are qualified. DO NOT apply for a car loan unless you have your credit score in hand. You can get your credit report instantly online from Experian, Equifax or TrueCredit. Forget about the free annual credit report, it does not give you the credit scores that you need, you have to pay to get them. Be sure to get your credit score with the credit report. If your credit score is below 600, don't bother applying for a car loan until you repair your credit first. Learn how to repair credit at our other site DebtWizards.com. Your credit score will NOT drop if you run your own credit report Many people mistakenly think their credit score will drop if they run their own credit report. Salespeople keep you in the dark about you own credit report so they can use your ignorance to charge you higher interest rates. You can verify this urban legend about your credit score at Experian, Equifax or TrueCredit. What is auto refinancing? How do I benefit by auto loan refinancing? Auto refinancing is one of the best kept secrets around for saving you money, but most people never thought of refinancing their car. Car refinance is the same as home refinance. When refinancing car loans, you pay off your current car loan with a refinancing car loan from a different lender that has a lower APR. This is good for you because refinancing auto loans makes your monthly car loan payments lower, and your interest rate drops, which can allow you to pay off the balance of your car loan even quicker. Record numbers of homeowners refinanced in 2001 and 2002, and now many car owners are realizing you can save thousands of dollars by refinancing auto loans too. Car refinancing has become a very popular trend with dropping interest rates. It's like finding a wad of cash you didn't know you had in your clothes after doing the laundry. Use the money you save to pay off credit card debt or accelerate your car loan payoff. Note: Most lenders will not refinance their own auto loans. So if you plan to refinance your auto loan, you will need to look for a lender other than your current lender. It's absolutely the most important priority that a person with bad credit, paying a high APR, refinance their car loan to a lower APR. It's true, most bad credit borrowers can indeed refinance to a lower APR, but many don't think to try because they were "programmed" or duped by the dealer into thinking they are stuck at 21-25% APR. Real world auto refinancing example Suppose you borrowed $16,500 for 60 months on your new Honda Accord. Let's assume your credit was bad, you had no previous credit, or the dealer lied about your credit and charged you a higher APR than you should have paid. This happens quite a bit. Suppose the dealer "got you approved when no one else would" at 21% APR for a 60 month car loan. Sound familiar? So you start paying off your car loan for a few months, then refinance your car loan with another lender at 7% APR. Interest Rate (APR) Monthly Payment Total Interest On Car Loan 21% $446.38 $10,282.83 7% $330.63 $3,337.57 Your current payment at 21% APR would be: around $446.38 Your new car loan payment at 7% APR is: around $330.63 You save $6,945!

Send in an extra $50 monthly principle more than the $330, and your loan will pay off even quicker. See how powerful auto refinancing can be for you? Most people have no concept of the time value of money, and just how bad high interest car loans are for your bank account, and what a difference 1% makes. That $6,945 is better off in your bank account, not theirs. Of course your actual APR would depend on your credit rating. Not everyone gets the 7% or lower APR, but I'm sure it's got to be lower than what you're paying now.

It's very important to refinance your auto loan early, because with car loans, the interest is mostly paid in the earlier payments. The earlier your car loan is refinanced, the more money you save. Our examples here are based on savings only if you refinance during the first couple of months of a car loan. If you wait until the 4th year to refinance your car loan, your savings will be a lot less.

Who should refinance their auto loans? What APR % should you look to refinance a car at?
Anyone who did not get a 0% to 3% APR car loan from the carmakers should consider a car loan refinance. Even if you got a decent APR auto loan, you should consider car refinancing. I like to use the 1% rule. After you buy your car, start watching the auto refinancing interest rates at sites like Up2Drive and myAutoloan.com looking for refinancing auto loan rates at least 1% less than your current car loan interest rate. Use the calculators on these car refinance lender sites to see how much it saves you to refinance your car. You'll be astounded at how much money you just found, and you'll stop the hemorrhaging in your bank account.

Tips to ensure a speedy auto refinance loan approval
Pay close attention to these important points, because you would hate to get rejected for making a stupid clerical error.

• Auto refinance loan applications need to be in the same names (with exact spelling) as the names on your current auto loan. This is important because that is how your current auto loan is identified and found. Have your car loan account number ready. If you give them a name with a different spelling, they cannot find your current loan, and you get rejected. Sounds like a no brainer, but...
• You must refinance more than $7500. Any less and it's not worth the auto refinance company's time.
• It's also important to have all the vehicle information accurate so that Up2Drive and myAutoloan.com can price out the car to make sure it meets Loan to Value ratio guidelines. Enter the year and model and enter the 17 digit VIN (Vehicle Identification Number), found on your dashboard or registration.
• Your auto refinance loan amount should not be higher than the value of the car. Just like home refinancing, where the bank won't lend you more than the value of the house. You might want to check your values first to make sure your car has retained a reasonable amount of value relative to the amount you still owe on it.

I already got a good APR car loan. Why do I need to refinance my car?
Suppose you already got a good 7% APR car loan. Here's another example with the same $16,500 loan for 60 months mentioned above:

Your car loan payment with 7% APR: $326.72
Your new payment when you refinance your car to 6% APR: $279.21
You save $463.72!

The above example shows you that even if you got a low APR you can benefit by auto loan refinancing. It also demonstrates just how much money lenders have been making off us all these years. Would you have thought in a million years that getting a 7% APR car loan was costing you $463 too much? In this day of stock market volatility, corporate accounting scandals, and watching your retirement account plummet, you need to empower yourself more, and take charge of every penny of your financial well being. Don't let the greedy lenders do it for you. Use the friendly lenders that we review here, like Up2Drive and myAutoloan.com.

If you don't look into auto refinancing today, you could be throwing away thousands of dollars!

What about loan fees and early payoff penalties?
The "gentle" lenders that we recommend here like Up2Drive and myAutoloan.com do not have any fees. No loan application fees, no points, no origination fees, and no early termination penalties. It's even in writing on their web sites. The only cost you might see is the small fee from your state to change the name of the lien holder on your car's title to the new lender. Other than that, there's no scams, the only thing you pay is the loan balance and interest. It's very seamless, completed in a few days, like you never even left your loan. The only difference is now your monthly car loan payments will drop, and the checks become payable to the new lender instead. You should be cautious about other auto loan refinance lenders not reviewed here who might have hidden fees or charge to process your loan. Also, carefully check your current car loan for any early payoff fees and penalties. It still may be beneficial to refinance even if there are some penalties involved. Each situation is different, so you need to do the math.

Can I refinance my car through the same lender that I used for my original car loan?
No you can't. If your car loan is with Greedy Bank USA, they will never refinance your car loan to a lower rate APR. Why would they? They already have you trapped. When you are auto refinancing, you must always do it through a different lender than your current car loan.

I have bad credit and I am paying 21% APR now. Who in the world would approve me for auto refinancing?
Good question. Even though you have bad credit, someone took a chance on you, even though you're paying 21% for that honor. Once you have paid on time for 3 to 6 months, you can start shopping around for auto loan refinancing. The beauty here is you are not taking on more debt, you are swapping one car loan for another car loan with less APR. The banks should not have a problem with that. Submit one free application to a bad credit auto loan site like myAutoloan.com, that finds bad credit car loans for people with bad credit. Send in extra principle payments to buy down the APR and pay off your car loan faster. They can find you car financing from high risk underwriters. Even if you have a discharged bankruptcy, tax liens, or bad credit, as long as your credit score is 550 or above, your chances are good. You should be working at least 6 months, and no bad credit the last 6 months. Many banks, once they see you have paid on time for a few months, will then take a chance on you. You might not pay as low APR as someone like me with perfect credit, but you'll almost certainly pay as much as 10% less APR than your current 21% APR car loan rate. Remember, car dealers tend to jam all questionable credit people into 21% APR, while gentle lenders sort you out better into "good", "fair", and "poor", buckets, charging you lower APR than car dealers. This way is much better for you, because you will then be charged a lower APR that more accurately reflects your credit rating. You can also try Up2Drive and myAutoloan.com. Remember, even if you end up saving only 1% APR, it's still a lot of money over the life of the loan, and it still lowers your monthly payment. If you can save 10% off a 21% APR, 60 month loan of $16,500, your payments will drop nearly $100 per month, and you'll save over $5200! That's why it's the absolute most important priority that people with bad credit who are paying a high APR need to refinance car loans to a lower APR.

People with bad credit don't realize that they can never get out of their credit crunch because they are stuck in the 21% APR range on all their loans and credit cards. By paying only the minimum payments, they will NEVER pay off their debt, because they have no concept of the time value of money, and don't realize the high APR is what is preventing them from paying off the principle. Most of them are brainless, with no common sense, and go buy new expensive cars at high APR when they have no business doing so, and should be buying a cheap used car if anything at all. Auto loan refinancing is your only salvation if you fall into this bucket.

The car dealer credit score scam.
This scam happens all the time and explains why thousands of car buyers are paying way too much APR than they should be, and don't even know it. All because they did not know their own credit score before going to the car dealer. One guy emailed me to say his score was 780 (Excellent rating) from 3 credit bureaus. He negotiated the deal at the car dealer, filled out the paperwork including a credit application. Four sales guys came out of the finance office with "concerned looks" on their faces. They had a piece of paper that said "credit score" on it with the number 580 circled in red. That's all that was written on it. They stated they could get him financed at 10.9% but not at the special 0% interest rate. When asked how they calculated that score and where they received it from they just mumbled and said he can only get financed at 10.9%. He pulled out his credit reports and asked them why they were different from theirs. Three out of the four scattered immediately, the last guy lied and stated that credit agencies like to give better credit scores to consumers than to business that actually lend money. Our friend just started laughing and got up and left, and bought the car elsewhere with the low 0% advertised APR. But you can see that quite often car buyers are suckered into paying a much higher APR by dealers because they did not know any better. Don't let this happen to you!

What A Low Credit Score Means To You
Your credit score is the most important factor determining if you'll get approved for a car loan, and what your APR will be. If your score is low, you'll pay extremely high interest rates on a car loan, up to 23%. If your score is below 750, you can forget about getting that elusive 0% car financing we hear about once in a while. Are you aware your credit score affects how much you'll pay for car insurance rates? Maintaining your credit score should be an ongoing process, not a task you rush into when buying a new car. In fact, that's the worst time. The reason is banks will reject you if you have disputed items on your credit report, until it resolves. It can take 60 days to clean up your credit score, so don't apply for any credit until all disputes are resolved and you verified your FICO Score. You have been warned! I have seen people get rejected for applying while closing accounts. Right now, you should be asking yourself "How good is my credit score?"

Credit score myths: "I've never missed a payment. My credit score must be high!"
This could not be more wrong. Many people get upset when they get their credit score and find out just how low their credit score is. Sure paying on time is one of the best things for your FICO score, but it's only one of over 100 variables making up your credit score. Having many open accounts does just as much damage to your credit score, as there is potential for you to run up your credit limit on all your accounts. People with good credit tend to have too much credit, and too many old accounts that they no longer use. Lenders view that as a risk. When I got my score it was ok, but needed improving by closing half a dozen computer store and department store cards which I no longer use, but they were dragging down my score.

A high credit score does not guarantee your car loan approval
Lenders verify if you have had an auto loan before. If not, even with a high credit score, you may end up paying a higher APR, or you can get rejected. You can have a high score and if your current debt load is high, they might reject you.

How to increase your chances on getting approval on a car loan

• If you're a recent college grad, don't apply until you're at your new job at least 6 months.
• Don't apply if you have moved in the last 6 months. Lenders hate nomads and most verify address and income.
• A previous car loan or home mortgage on your record helps.
• Pay off your credit card balances as low as possible.
• Get a stable job with a consistent paycheck. No self employment.
• Other examples of credit extended to you should appear on your credit report.
• Don't apply for a car loan for at least 3 years after a bankruptcy.
• Don't keep a high debt load or credit card balances.
• No charge off's on your credit report.

Credit card companies say it takes 60 days for a change (such as paying off your credit cards) to show up on your credit report/score, but who wants to wait 2 months before buying a car? One of our visitors filed a request for investigation of her report stating that the balances on these cards were incorrect, and the investigator looks up your correct balances and changes it. She checked 2 weeks later and it was changed. Also, by paying off 2 credit cards from 70% max credit level down to 0%, increased her credit score 100 points. That's the difference between paying 6% APR for a car loan and 21%.

These are the steps to take before you apply for a car loan:

• Get your Credit Score so dealers can't lie to you about your score.
• Close old accounts, they are excess luggage dragging down your credit score.
• Remove erroneous previous addresses and other errors off your credit report.
• Try to get any "Charge Offs" removed by negotiating with your creditors.
• Wait until your score goes up to 680 if you're applying for a prime car loan.

CarBuyingTips.com is the web's first car site to support your Mobile PDA! Download our Car Loan Spreadsheet for Pocket Excel. This awesome spreadsheet analyzes 4 car loans at once. Check the dealer's math on your PDA! It won't work on Palm Pilots unless you can open Excel with them. Right click the link, do a "Save Target As" to your desktop, drag it to your PDA sync folder. Enjoy! Please email me your opinion.

Benefits Of Car refinancing on the web:

• Usually you pay lower APR to online lenders than you would at the dealer and no scams! Check rates at Up2Drive and myAutoloan.com.
• Avoid headaches, scams and frustration of dealer financing.
• Approvals are usually within an hour during business hours.
• You don't pay hidden application fees, points or prepayment penalties.
• Online lenders FedEx your check the next day after approval.

Extended Warranties
As with financing, you must shop for extended warranties before you buy your car so you can compare with the dealer's warranty pricing. For extended an warranty, try Warranty Direct. I Review both of them in detail in the section on How To Buy An Extended Warranty And Avoid Scams. You want to get an online warranty quote before you go to the dealer, so you'll have something to compare the dealer's extended warranty price with. Never show up at a dealer to buy a car without a free quote from an online warranty site.

Credit Unions:
If you're a corporate employee, school district, government agency, college, etc., you probably have a credit union. Credit unions are easier on you than banks, they'll lend you more money at favorable rates, usually 2% better, but not as good as the car loan sites. Your credit union can approve you over the phone in minutes, printing your credit report during the call. They'll tell you what you qualify for. I have found more often than not, the online lenders rates usually beat the credit unions.

Remember, get a copy of your credit report so there's no surprises. The Credit Union can deduct payments from your pay check if you desire. Credit unions also give more favorable benefits than leasing companies. Most don't require a security deposit, down payment, other fees, and are generous with mileage. If you use a credit union, make sure there is no fine print that says they can put a lien on your home if you default on the car loan. The Postal Service credit union has this lien.

Bad Credit Causes You To Pay More For Insurance
Many insurance companies run credit checks on you before the application is signed. Some online companies bypass this by allowing you to supply a self reported credit rating from a pull down menu. The reason for the credit checks is that there is a higher underwriting risk not only in terms your ability to make payments and keep policies in force, but the higher claims/loss ratios of folks with bad credit. A 40 year old man with a couple of late payments and no tickets, accidents or major violations might very well qualify for a preferred policy.

What's on your credit report
Some sites give you your credit report free, but you must sign up to their credit monitoring service to get it. You are allowed one free copy of your credit report by a creditor who rejects you, otherwise it's $7.95 from most sites. Your credit report appears online, and shows who has checked your credit history too. You'll see many inquiries with no credit issued and this hurts your chances of qualifying. You must have all these unauthorized inquiries removed from your credit report, especially from car dealers who checked your credit while you were out on a test drive. Usually credit bureaus want to know your address, previous address, SS#, employer, the usual, to get your credit report. Many errors can be quickly removed with a phone call to your creditor. You MUST have a copy of your credit report if you've never seen it before. Show up at a dealer before obtaining your credit report, and you are in big trouble. You might as well just give them your checkbook. A car dealer should never know more about your finances than you do, and besides, you might find an error in your report. This puts you at a disadvantage when the dealer calls 2 weeks after the sale to say "financing fell through, we need more cash" and they blame some black mark on your credit history.

TIP: When filling out the forms for your credit report or anything else online, remember to enter your full email address properly! If your email address is forgetful@aol.com, don't just put "forgetful", you must add the full "forgetful@aol.com" or your request will be denied. They need to be able to email your report to you as a backup. Also, you will need your Drivers License #.

People With Bad Credit Or No Credit
How does bad credit hurt you? Dealers charge you 18% interest or more, while the rest of us enjoy 2% to 8%. Bad credit keeps you from opening a checking account! Banks run a credit check because they know people with bad credit bounce checks. The fact that you shafted all of your creditors is coming back to get you. Most cases of bad debt are from pure ignorance. Don't live beyond your means! Plan your life with a budget that has a reasonable and sustainable car payment built into it. If you have bad credit, please don't email me asking what to do, I am not a credit consultant. Go check out the free consumer credit info site DebtWizards.Com instead.

Restoring Your Credit
There's only one way to restore your tainted credit: Pay back what you owe. If you have credit card balances, transfer them to your lowest APR card. Pay off debt before you buy a new car, high balances hurt your chances of qualifying. Stop spending. Pay more to cards with high APR, send more than the minimum payment, or it will take 10 years to pay it off. If you have cash in the bank earning 2%, it's losing you more to income taxes, so be smart and use it to pay off 18% debt. If you have equity in your home, consider a home equity loan to pay off credit cards, close the accounts, and write off the interest on your taxes.

The Proper Way To Consolidate Your Debt
Consolidation loans are not for everyone and can be dangerous if you aren't careful. There's a lot of people out there who aren't paying attention when they consolidate their loans. Sometimes the interest rate can be higher than the rate you currently have on your debt. If the loan's APR is higher than your credit cards, you'll lose money and should not close on the loan.

You Cannot Borrow Your Way Out of Debt!
Consolidation loans are DANGEROUS for impulsive people because all you are really doing is shifting all your debt from one place to another, effectively OPENING ANOTHER CHANNEL OF CREDIT, while freeing up your credit cards. Some idiots then proceed to fill up their credit cards again, now they have double the debt they started with, and they are paying up to 22% on their consolidation loan because they weren't paying attention to the APR when they signed up. Some Loan companies are very unscrupulous and make it look like they are eliminating your debt or they hide the APR from you.

Don't Forget Auto Insurance
Don't overlook this important part of car buying, you'll be in for a shock later. Get a quote on the car you want. You'll be surprised how much some new cars cost to insure. Some cars are very difficult to insure. Know your insurance costs before you buy a car, and plan your budget accordingly. My 25 year old friend pays $2400 a year for insurance on his 2008 Mustang, and the GT is even more (Shelby GT 500 - Forget about it!). That's $200 per month! This is where people make a big mistake, forgetting to include insurance in their budget. If you're buying a car on the hairy edge of what you can afford, insurance payments will drag you under. Insurance payments are part of your monthly cost of ownership. Read up on how to buy insurance, definitions of coverage and how to avoid scams in our insurance chapter All About Auto Insurance. Auto insurance sites BestCarInsuranceSite, Allstate, GEICO and Progressive Auto Insurance give you free online auto insurance quotes, so be sure to get pricing from them too.

Extended Warranties
For extended an warranty, try Warranty Direct. I talk much more about them in detail in our online guide for warranties called How To Buy An Extended Warranty And Avoid Scams. You want to get an online warranty quote before you go to the dealer, so you'll have something to compare the dealer's extended warranty price with. Never show up at a dealer to buy a car without a free quote from an online warranty site.

Go On to Chapter 2: Discount Car Buying & Car Pricing On The Internet

Jump to any chapter. I suggest you read each chapter in order.
Chapter 1 Get your credit report, how to get a car loan, scams, online car loans, first time car loans, budget & loan excel spreadsheets, credit repair.	Chapter 2 Reviews of internet discount car buying sites, new car prices, find dealer's invoice cost. Get a new car quote.	Chapter 3 What to bring to a dealership, what to say, how to act, what not to do, what to look for at the dealership and a glossary of all dealer fees.	Chapter 4 How to read dealer invoices, finding dealer's cost, how much to offer the dealer, buyers offer spreadsheet, examples, trade-ins.
Chapter 5 Negotiating tips, dealer scams & tricks to watch out for, dealing with aggressive salespeople, choosing between rebates or low APR loans.	Chapter 6 Close the deal, avoid needless extras, scams in the business office, extended warranty scams, options, buying warranties online.	Chapter 7 Actual misleading dealer ads, and what to do when you've been ripped off, customer satisfaction surveys, how I bought my Lexus.

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