If you are new to the world of vehicle buying and selling, you might be asking yourself, how do I refinance my car? Is it easier to go through a large bank or some other lender like a credit union?
The answer to this question really depends on the individual institution that you're talking about, but some common differences do apply between banks and credit unions. For example, a bank car loan is going to include some significant requirements for documentation and items to lower the lender's risk. Lots of banks don't even handle personal loans or loans anymore, because they would prefer to invest in a sure thing, which generally means larger commercial or municipal debts.
Getting Refinancing through Banks
The major benefit of getting refinancing from a bank is that, because of their large pools of capital, they may be able to refinance your existing loan for a lower interest rate. However, if you are focused on what's easiest, a credit union might be your better bet.
Getting Refinancing through Credit Unions
Lots of your financial transactions are going to be easier at your local credit union than at a local branch of a large bank. That's because the credit union is set up to provide services to a core group of people. Your employer might have a credit union, if they're big enough. Otherwise, your credit union probably has some other affiliation with a region or institution. With that in mind, members are often able to get a credit unions refinance loan more easily because they have already built some of the trust that is critical between a lender and a borrower.
Think about the above next time you're casting around for a lender to refinance your car purchase.