Should I refinance my car loan if I'm worried about it affecting my credit score?

"I want to refinance my car loan, but I'm worried that the hard inquiry or the loan itself will negatively affect my credit in the short term.

I'm also thinking of refinancing my student loans in a few months, and I'm worried about what the auto refinance might do to my credit. Should I refinance my car loan?"

Answer
“When you refinance your vehicle, you’ll definitely have a hard inquiry on your credit report. However, this might lower your score by 10 points at most, provided that you don’t get your credit pulled numerous times.
As for the impact refinancing might have on your student loans, you shouldn’t worry about it. A small drop shouldn’t affect your ability to refinance those as well.
That said, you might want to hold off on refinancing your student loans anyway. The current administration keeps pausing loans due to COVID-19, and there’s a growing sentiment that they may cancel all or part of your loans.
If you can afford your payments on your student loans currently, you should refinance your car and hold off on refinancing your student loans.”
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Eric Schad
Answered on Jun 02, 2021
Eric Schad has been a freelance writer for nearly a decade, as well as an SEO specialist and editor for the past five years. Before getting behind the keyboard, he worked in the finance and music industries (the perfect combo). With a wide array of professional and personal experiences, he’s developed a knack for tone and branding across many different verticals. Away from the computer, Schad is a blues guitar shredder, crazed sports fan, and always down for a spontaneous trip anywhere around the globe.
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