How does refinancing your car work?

My credit score has improved since I first took out my car loan. I have a cosigner, but I’d like to take them off my car loan and see if I can take it over on my own. I heard I could do this via refinancing. How does refinancing work?

Answer
Congratulations on your improved credit score!
You are right; you can take off a cosigner by refinancing. Refinancing requires applying much like you did when you originally applied for your car loan–sans cosigner.
When you apply, you will need to bring in:
  • Your driver’s license
  • Proof of insurance
  • Proof of income
  • Proof of address
Once you have these materials ready, you can start by letting your current lender know that you want to refinance They likely want to keep your business, so they’ll be willing to work with you.
It’s still a good idea to shop around for lower APRs (interest rates) to help you save money when you refinance. One of the easiest ways to find the best rate on your new loan is to use the Jerry app. No matter what your credit score is, Jerry makes refinancing your car easy by comparing quotes from multiple lenders to find a rate that works best for you. On average, car owners pay $85 less every month by refinancing their auto loan.
Lauren Smith
Answered on Oct 29, 2021
Lauren has written for World Nomads, the Matador Network, Korvia Consulting, and once upon a time Three Fates Games. She graduated from Columbia College of Chicago with a BFA in Creative Writing. After graduating, she moved overseas and lived in South Korea where she spent her free time traveling and going on road trips with friends. She misses the rest stop potatoes and is trying to figure out how to recreate them at home. She's now based outside of Chicago and when she's not writing she spends her free time reading, playing video games, and exploring whenever she can.
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