Does a car loan start over when you refinance?

I’ve already paid my car loan for three years, but I have four years left. My interest rate is 9.49%. I think I can get a better rate, but I don’t want to start from scratch. Does a car loan start over when you refinance?

Eric Schad · Updated on
Reviewed by Shannon Martin, Licensed Insurance Agent.
Refinancing a car loan
can seem confusing in this aspect, but thankfully it does not start your loan over from the beginning.
You start from scratch in terms of your loan length, but your new balance is whatever it was when you refinanced for the car.
For example, if you still owed $11,000 on your car before you refinanced but you originally owed $20,000, your refinanced car loan balance would be $11,000, not $20,000. If you originally got a 84-month loan but you refinance into a 48-month loan, you would pay that remaining $11,000 over 48 months.
Refinancing may be able to help you out—but it’s not worth it unless you’re able to get a better interest rate than your current 9.49%.
Want to save even more money when you refinance? Take a look at your car insurance policy. If you think you’re paying too much, use the
app to shop rates and get a better value for your money.
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Jerry partners with more than 50 insurance companies, but our content is independently researched, written, and fact-checked by our team of editors and agents. We aren’t paid for reviews or other content.

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