"Is there any way to refinance a car that is worth $5,000 that I owe $11,000 on? "
"I bought a used Kia two years ago, putting $1,500 down. My car loan interest rate is nearly 23%.
I have applied for a refinance loan with a few banks, but they have all denied me. Is it possible to refinance this kind of loan?
Answer provided by
Answered on May 25, 2021
“The only way to refinance your Kia is to pay down the loan until you are no longer upside-down on it. At that point, you can apply for refinancing.
When you finance or refinance a car, the loan is secured by that car, which means that the vehicle needs to be worth the amount financed.
Unfortunately, because of your high interest rate and your low down payment, you have been paying more on your interest than your principal. This means you still owe almost the same amount of money you bought the car for two years ago, but the car is no longer worth that much. “
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