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How soon can I refinance my car loan after I purchase my vehicle?

My partner and I live in Seattle. We recently took out a loan to buy a Honda Odyssey because we’re expecting twins. We have been discussing refinancing our existing loan to cut back on our expenses. How long do I have to wait to refinance my car loan?

avatar
Kathryn Kurlychek · Updated on
Reviewed by Shannon Martin, Licensed Insurance Agent.
While you can
refinance your car loan
at any point after you have purchased your vehicle, waiting to build credit is ideal. Typically, lenders prefer that the borrowers wait six months to a year to apply for a new loan
That being said, nothing legally obliges you to wait six months. 
The major concern for most lenders is whether or not you have positive or negative equity. Negative equity refers to a situation on a loan where you owe more on the loan than the car is worth.
If you have negative equity on your car loan, most lenders won’t refinance you. If you have positive equity, refinancing is a non-issue. 
Keep in mind: It’s a good idea to shop around to make sure you can get a better rate. If you can’t get a better rate than what your loan currently offers you, you have no reason to refinance.
MORE: Does refinancing a car hurt your credit score?
View full answer 
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