Can I Refinance My Car?

Loan It is one of the elements of what many know as the American Dream – car ownership. For most, owning a car means borrowing money and carrying an auto loan. Just as someone can refinance a home mortgage, it is possible to refinance a car loan as well. Car refinancing is not for everyone, and there are a few cases where a person’s car disqualifies them from doing so. If you are the owner of any of the following, you cannot refinance your auto loan.


  1. An ancient beauty. Refinancing a car is nothing like refinancing your home. Real estate rules do not apply to the refinancing of an automobile. The instant your vehicle comes off of the lot, it begins to depreciate. If you have a very old vehicle, lenders do not see it as a viable asset worthy of lending. Another consideration is the loan-to-value ratio. An older car is normally worth less and the potential to become upside down in a loan are much higher. As a result, lenders will most often reject a refinance on an old vehicle.
  2. A salvaged car. If you have a vehicle that has a salvage designation on its title, forget it. Each state has its own criteria for what constitutes a salvage vehicle. Because of the salvage designation, the market value of the vehicle will be low. Again, lenders do not want to take the risk of refinancing a car with little value.
  3. A customized vehicle. If you have modified your vehicle or customized it in any way, a lender will not consider a refinance. Again, a customized vehicle, while worth money in a niche of the auto market, is worth far less than the same vehicle that has not been modified when considering a refinance.
  4. Commercial vehicles. A business vehicle is normally used much more than one for personal use. This use causes rapid depreciation of the vehicle. To a lender, the vehicle is not as useful as collateral as the same vehicle owned for personal use. It is highly likely that one would be rejected for an auto refinance using a commercial vehicle as collateral.


If you own one of these vehicles, you most likely cannot complete an auto refinance. What you may be able to do, though, is apply for a car title loan. If you are looking for emergency cash or trying to consolidate some debt with an auto refinance, you can still do so with a car title loan. You can apply online at Embassy Loans and complete your transaction within an hour. The process is quick and easy and can be completed entirely online. Call today for more information.