Refinancing your car not only lowers your monthly auto payment and interest rate, it helps with debt consolidation as well. Refinancing through a credit union is one of your options when you are looking to do this. The advantages of dealing with a credit union are numerous. They usually guarantee—should you qualify—a reduction of at least 1% APR and no fees or prepayment penalties. The 1% figure is just a minimum. You may be approved for an even greater reduction. They require, however, that the original loan be held by another institution and that your credit be good. If this fits your situation, it is worth it to further investigate this option.
Check Your Situation
Before you go to a credit union to refinance, you have to know your credit score. It will save both you and the credit union time if you know in advance what type of credit score you have. More than likely you won’t qualify for credit union refinance if you credit is below 680. Also, if you originally borrowed from a non-institutional lender such as the many found online, you may not be eligible for refinance. It is worth calling and checking on that last point.
Make an Appointment
If you think you are eligible, go in and wait to speak with an agent. If you are not a member, you will first have to sign up. Credit unions are not-for-profit organizations that answer to a local board of governors and their members. Different from banks, credit unions only operate locally which translates to lower rates of refinance for their members. You don’t have to give up your bank account, but if you want to refinance through a credit union, you will have to join.
Determine the Savings
Once in discussion with a refinancing agent, you will fill out an application to determine what rate you are eligible to receive. If your credit is good, your employment and income sound, there is no reason you won’t get the most favorable rate for refinance. You have to apply to see. The credit union will be able to give you an estimate before entering your final numbers. From there, you can decide if you want to pursue this option.
A credit union is a good place to do business because they pass their lower costs onto their members in the form of lower loan and refinance rates. Since they are locally governed, they are not subject to institutional manipulation from out of state. Should you meet their conditions and qualify, refinancing through a credit union is possibly the place to get the lowest rate available. If you have good credit and would like to join a credit union, it is worth it for you to inquire. You just might end up saving a lot of money.