Can you lower the interest on a car loan?

Tara Baukus MelloQuestionDear Driving for Dollars,
I got a new car from Honda in 2007 at 12 percent for five years. How can I lower my interest rate?
-- Anna

AnswerDear Anna,
If you have good credit and have been paying on time, you may be able to get your interest rate lowered by calling your lender and asking for a better interest rate. But chances are, the only way you'll be able to lower your interest rate is to refinance your car loan. The good news is that auto refinance rates are lower than they've been in recent years. The bad news is that the shortest length of time you'll probably be able to refinance for is 36 months -- longer than the length of time left on your existing car loan. Still, it may be worth it. To learn more about the process and whether you qualify, read this Bankrate story on refinancing a car loan when money is tight.

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