Best auto loan refinance rates for June 2023

Written by
Rebecca Betterton
Edited by
Rhys Subitch
Reviewed by
Mark Kantrowtiz
As of June 06, 2023
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Refinancing your auto loan allows you to replace your current loan with a new one in order to get more favorable terms and lower rates. They are available through a variety of lender types, so it is wise to shop around to consider which fits best for your needs. 

Bankrate’s best refinance auto loans were chosen based on lender’s interest rates, customer experience, available terms and transparency. Consider the lender benefits and drawbacks outlined below to determine what the best financing option is for you.

When it comes to refinance loans, pay special attention to eligibility requirements and available terms. Doing so allows you to know whether your current loan qualifies, and you can adjust your loan to fit your monthly budget.

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LINE OF CREDIT

4.1

Bankrate Score
APR from

5.69- 28.55%

Term

24-72mo

Min credit

Not disclosed

Apply on partner site

3.9

Bankrate Score
APR from

5.24%

Term

24-72mo

Min credit

700

Apply on partner site

4.0

Bankrate Score
APR from

4.99- 24.99%

Term

12-120mo

Min credit

640

Apply on partner site

4.0

Bankrate Score
APR from

5.49%

Term

24-84mo

Min credit

600

Apply on partner site

4.2

Bankrate Score
APR from

8.74- 16.19%

* with AutoPay
Term

24-84mo

Min credit

700

Apply on partner site

4.0

Bankrate Score
APR from

4.49%

Term

24-84mo

Min credit

560

Apply on partner site

4.2

Bankrate Score
APR from

4.67%

Term

24-96mo

Min credit

Not disclosed

Apply on partner site

  • Get approved in 2 minutes or less for credit lines up to $200,000.
  • Apply once, even if you aren't ready to purchase for up to 24 months
  • Use Flexline™ to buy new or used vehicles, buyout leases or refinance loans.
  • No impact to credit for pre-approval. One hard credit pull to access line of credit for life*
  • *Lifetime access with rotating balance, lifetime access expires with 24 months of inactivity

w/0.25% autopay discount
Apply on partner site

Compare auto loan refinance lenders in June 2023

Lender Starting APR Term
LightStream 8.74%* with AutoPay 24 to 84 months
Autopay 4.67% 24 to 96 months
Caribou 5.69% Not specified
Upstart Varies by state 24 to 84 months
RefiJet 5.24% Not specified

Loan details presented are current as of May 17, 2023. Check the lenders’ websites for more current information. The auto loan lenders listed here are selected based on factors such as APR, loan amounts, fees, credit requirements and more.

Best auto loan refinance lenders of 2023

Best for fast funding

LightStream
See offers Arrow Right

Apply on partner site

Min. credit score:
700
Fixed APR From:
8.74% –16.19%
Loan amount:
$0– $100,000
Term lengths:
2 to 7 years
Min. annual income:
Not disclosed
Overview: LightStream offers an easy-to-navigate online interface for unsecured loans. You can apply for repayment terms from 24 to 84 months and a high maximum refinancing amount of $100,000.
 
Why LightStream is the best for fast funding: If you are in a precarious financial position and need funding right away, LightStream is a great option. With same-day funding available and no additional origination fees, LightStream offers a quick online application process and a higher maximum loan amount than competitors. 

How refinancing a car loan works

Refinancing a car loan is essentially just taking out a new car loan — so the steps for applying are mostly the same. You'll need your driver's license, Social Security number and proof of income and insurance, as well as details about your car. If approved, you'll use the funds from your new loan to pay off your old car loan, then begin making monthly payments with your new interest rate and terms.

When you refinance your car loan you receive a new auto loan that replaces your current one. The process is similar to that of getting your initial loan. Following application and approval, you will pay off the initial loan with your new one, then begin making payments on your new loan. 

When should you refinance your car loan?

Refinancing your car loan comes down to saving you money. If you are struggling to afford your vehicle payments or think you could receive more favorable terms, it’s a good idea to consider refinancing your current loan. Here are the three main scenarios where refinancing is the right choice.

  1. Your credit has improved.  Competitive rates are reserved for drivers with very good or excellent credit — scores of 740 and above. So, if your credit score has risen since you signed off on your initial loan agreement, refinancing could save you money on your monthly payments.
  2. You financed through a dealership. Dealer financing likely did not present you with the best available rates and terms. You might be able to get a better deal if you shop elsewhere and refinance your initial vehicle loan.
  3. You can’t afford your monthly payments. If you are struggling to make your monthly vehicle payments and are at the risk of losing your vehicle it is a good idea to refinance your loan. This way you can extend your terms to lower your monthly costs. Keep in mind that you will have to pay more interest over the life of the loan. 
  4. You have positive equity. If you have positive equity in your vehicle, or the value of your vehicle is worth more than you owe, the cash-out refinance process could present you with some extra money and improved loan terms. 

Pros and cons of refinancing an auto loan

The choice to refinance your auto loan requires some consideration on the state of your finances and vehicle. Weigh the benefits and drawbacks before moving forward with it. 

Pros

  • Checkmark

    Potential to decrease monthly cost.

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    Ability to sign off on more competitive interest rates.

  • Checkmark

    Likelihood of paying off auto loan sooner.

Cons

  • Extending the loan too long could mean more money spent in the long term.

  • Headaches caused by paperwork and loan application.

  • Increased risk of becoming upside down on loan.

What to know before applying for a refinance auto loan

As with any loan, it is best to shop around to different lenders before making your final decision. Each lender has its own methodology when determining your interest rates and terms — so compare to see which best fits your needs. 

While every lender measures risk differently, interest rates depend greatly on your credit. Do your homework ahead of time to understand your credit history to get a clear picture of what lenders are looking for and what type of terms you will be offered. 

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Bankrate tip

When comparing lenders pay close attention to any prepayment penalties that you may incur. Factor that in when calculating if refinancing will save money.

FAQs about refinance

Methodology

To select the top refinance car loans, Bankrate considers 16 different factors. These factors range in consideration from the loan amount, disclosed APR and acceptance criteria. Each lender holds a score based on four categories. 

  • Availability: This accounts for loan amounts, vehicle restrictions and availability in each state.
  • Affordability: Primarily, this section covers expected APR, acceptance criteria, discounts for autopay and the number of fees. 
  • Customer experience: This category includes online access, support availability, funding timeline, option for automatic payment and app availability.
  • Transparency: Here prequalification and disclosure of rates and fees are accounted for.