Tips on Refinancing vs. Trading in Your Car

When you have difficulty paying off a car loan, it could be that you are in over your head and need to lower your interest rate immediately. There are several options to lower these payments. The best option for most car buyers is a trade-in. When you trade in your vehicle, you are asking that the dealer purchase the car from you and place your equity in another car. This works out to lower your payments if you trade in for a car that has a lower price tag, such as a different make and model or a used vehicle. However, trading in your vehicle isn’t the only option available, especially if you want to keep your current car.

You can use refinancing as the second option. When you refinance a car loan, you change the interest rate and monthly payments to be lower. This works out by helping you fit the car in your budget, but it could also lead to longer loan terms and higher price overall with accrued interest. It’s important to check the value of your vehicle and read through the new loan contract before getting into a refinance situation.

You can see all of your options for trade-ins at Kia of Downtown Los Aneles.



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