Best Auto Loan Refinance Banks

LightStream offers low rates for borrowers with good credit

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Refinancing your auto loan allows you to secure a lower loan interest rate, duration, or monthly payment. Especially if your credit score is higher than when you initially took out the loan, refinancing an auto loan is one way that you can save money on interest and lower your car payment each month.

The best auto loan refinance banks and lenders offer flexible loans with competitive rates. Lenders typically consider the condition of your vehicle, the size of your loan, your credit score, your current interest rate, and the length of your loan when you apply for an auto loan refinance.

Best Auto Loan Refinance Banks of 2021

Best for Great Credit : LightStream


LightStream

LightStream

  • Starting interest rate: 2.49%
  • Minimum credit score: 660
  • Loan terms: 24 to 84 months
Why We Chose It

Lightstream is our top pick for auto loan refinancing for borrowers with good credit. The lender offers extremely competitive rates, and loans are available in all 50 states.

Pros & Cons
Pros
  • Low rates

  • Easy online application process

  • Available in all 50 states

Cons
  • Application triggers a hard pull on your credit

  • Only available to borrowers with good credit

Overview

If you have very good credit, you should take full advantage of it. Whether you've had it for years or it’s the product of a lot of hard work and dedication to paying off your debts and increasing your income now is the time to go out and secure a lower interest rate on your car loan. LightStream is a division of SunTrust bank that caters to consumers with good to excellent credit — LightStream requires a minimum 660 FICO. They perform a hard pull on your credit when you apply, so you should be prepared actually to make a decision when you do so. Hard inquiries can cause your credit score to fall slightly, which typically isn't a big deal, assuming you apply for new credit sparingly. LightStream's APR starts at just 2.49%, and refinanced auto loans are available in all 50 states. 

Best for Checking Rates Without Impacting Your Credit : Capital One


Capital One

 Capital One

  • Starting interest rate: Varies
  • Minimum credit score: None
  • Loan terms: Varies
Why We Chose It

Capital One allows you to prequalify for an auto loan refinance without hurting your credit, making it a great choice for borrowers looking to explore their options.

Pros & Cons
Pros
  • Borrowers can prequalify

  • Easy online application

  • No application fee

Cons
  • Minimum loan amount of $7,500

  • Charges a variable title transfer fee

Overview

By filling out Capital One’s easy questionnaire, you can see whether you’ll qualify to refinance your loan without impacting your credit score in the slightest. You will need to owe a bit more than some of the other loan refinancing options on this list — at least $7,500 — but you'll be able to see what sort of rates you’d get and pre-qualify without a hard credit check impacting your credit score. Once you pre-qualify, you submit your credit application which involves selecting the length of the loan and the corresponding APR. This will get posted to your consumer credit report. You'll finalize the deal by providing your VIN, E-Sign your contract, provide your lender details, and send in supporting documents such as proof of insurance. Capital One does not charge an application fee, however, each state charges a variable title transfer fee. Capital One will pay the fee and add it into your final loan amount, so you don'​t have to pay out of pocket at the time of refinancing.

Best Trusted Name : Bank of America


Bank of America

 Bank of America

  • Starting interest rate: 3.19%
  • Minimum credit score: None
  • Loan terms: 48 to 72 months
Why We Chose It

Bank of America is a good choice for an auto loan refinance for borrowers looking to work with an established brick and mortar bank with widespread availability.

Pros & Cons
Pros
  • Trusted financial institution

  • Quick application decision

  • Discount for Preferred Rewards members

Cons
  • Car must be fewer than ten years old

  • Minimum loan amount of $5,000

  • Car must have fewer than 125,000 miles

Overview

If you opt for an auto loan refinance from Bank of America, you get a trusted financial institution — and a decision in less time than it takes you to tie your shoes. There’s no fee to apply, and you can help yourself to all of their helpful online tools once you are a member of the Bank of America family. To qualify, your car will need to be fewer than ten years old and have less than 125,000 miles on it, and you will also need to have $5,000 or more remaining on your loan. Bank of America's current APR for refinancing a vehicle is 4.13%. It is smart to pay off your existing loan with proceeds from a new loan to take advantage of lower monthly payments, lower interest rates, or save on financing costs. Compare prices and use a car loan calculator to help determine the savings.

Read our full review of Bank of America.

Best for The Most Options : AutoPay


  • Starting interest rate: 1.99%
  • Minimum credit score: None
  • Loan terms: Varies
Why We Chose It

AutoPay offers flexible auto loan refinancing with plenty of options for all borrowers and an average savings of $95 per month.

Pros & Cons
Pros
  • Easy application process

  • Average savings of $95 per month

  • Compare loans from over 20 different lenders

Cons
  • Some vehicle restrictions apply

  • Minimum monthly income requirements

Overview

AutoPay specializes in auto loan refinancing, so it’s no wonder they offer great deals for many individuals. They often cater to clients who have improved their credit score in the time since they took out their original auto loan, and because of this, they are usually able to offer steeply discounted loans. On their site, you can compare offers for loans from many different lenders without having to fill out more than one application. They also pull your credit with a soft check, which is easy on your credit score and a great option if you are not seriously considering refinancing your loan right this second (once you pick a final offer, they do run a hard pull — but not until you are ready to commit). AutoPay makes it easy to shop around and often partners with credit unions. The lowest rate offered by AutoPay is 1.99% but this is only available if you have a top-tier credit score. The average rate at Autopay is 5.49%. Knowing your credit score ahead of time makes a big difference in estimating what your APR will be on refinancing a car loan.

Best for Members of the Military : USAA


USAA

USAA 

  • Starting interest rate: 3.04%
  • Minimum credit score: None
  • Loan terms: Varies
Why We Chose It

USAA is a great choice for auto loan refinancing for members of the military and their families, with competitive rates and the option to take your car overseas when deployed, moving, or travelling.

Pros & Cons
Pros
  • Autopay discount

  • No payments for up to 60 days

  • Easy application process

Cons
  • Only available to USAA members

  • Borrowers can’t prequalify

Overview

USAA only works with members of the military and their families, but for those who serve our country, this nearly 100-year-old organization offers rates and customer service that is often hard to beat. You won’t have to pay for up to 60 days after you start the loan, giving you time to catch up if you are behind. You can also choose from many of their vehicle protection plans if that’s something you’d like to add on as well. USAA offers to refinance for up to 60 months, and longer terms are also available. USAA takes the hassle out of refinancing by working directly with your lender. Their rates are stated on their website as being as low as 3.04% APR which is noted as including a discount of .25% for automatic payments. Rates are subject to change without notice and vary based on approved credit and other factors, such as term, model year, and loan amount.

Best for Peer-to-Peer Loans : LendingClub


Lending Club

 Lending Club

  • Starting interest rate: Varies
  • Minimum credit score: 510
  • Loan terms: 24 to 84 months
Why We Chose It

LendingClub offers peer-to-peer loans with multiple options to choose from, low rates, and simple application process.

Pros & Cons
Pros
  • Available to borrowers with poor credit

  • Flexible loan terms

  • Easy application process

Cons
  • Minimum loan amount of $5,000

  • Higher rates for borrowers with low credit scores

Overview

Peer-to-peer lending is a non-traditional option, but it is a great one for those who love the idea of working directly with an individual lender for a fixed period. Once you apply, you can often choose between two options and select the one that’s most palatable to you. Keep in mind that LendingClub is not a great option for those who don’t owe very much on their existing vehicle loan: their loans go all the way up to $100,000, but they won’t lend you less than $5,000 for this purpose. They do offer loans to borrowers whose credit score is as low as 510, though of course, you will pay handsomely for the privilege. Many borrowers choose LendingClub because of their low interest rates and less hassle than traditional financing options. They offer a friendly service, and no hidden fees or prepayment penalties.

Best Credit Union : Consumers Credit Union


Consumers Credit Union

 Consumers Credit Union

  • Starting interest rate: 2.24%
  • Minimum credit score: 640
  • Loan terms: 0 to 84 months
Why We Chose It

For borrowers looking to secure an auto loan refinance from a credit union, Consumers Credit Union is a good option, with flexible loan terms and low rates.

Pros & Cons
Pros
  • Loan amounts as little as $250

  • Competitive rates

  • Flexible loan options

Cons
  • Must be a member to apply

  • Borrowers can’t prequalify

  • Minimum credit score of 640

Overview

Like all credit unions, you will need to be a member of Consumers Credit Union for their auto loan refinancing services to be a viable option. However, once you become a member, the perks are soon evident. Unlike many financial institutions, their loan terms are incredibly flexible, especially if you don’t need to borrow a ton of money: they will lend you as little as $250 for as few as six months at a time. They will perform a hard pull on your credit, so make sure you’re serious about refinancing before you see what rate they will give you because your credit might suffer otherwise. But once they do check your credit, they will work with you as long as your score is above 640. Current APR for refinancing is as low as 4.40% to 4.90% based on the length of your loan and your credit history.

Final Verdict

There are lots of options when it comes to auto loan refinance banks and lenders. Some lenders stand out for their easy online application process, while others excel at providing refinancing options even for borrowers with poor credit. Overall, our top choice for an auto loan refinance lender is LightStream.

For qualified borrowers with good credit and steady income, LightStream offers some of the most competitive auto loan refinance rates. They feature a simple online application process, no restrictions on age or mileage, and funding as soon as the same business day.

Compare The Best Auto Loan Refinance Banks

Company Starting Interest Rate  Minimum Credit Score  Loan Terms (range)  Maximum Loan Amount 
LightStream Best for Great Credit 2.49% 660 24 to 84 months $100,000
Capital One Best for Checking Rates  Varies None  Varies  $50,000 
Bank of America Best Trusted Name  3.39% None  48 to 72 months  Not available
AutoPay Best for the Most Options  1.99%  None  Varies  Not available 
USAA Best for Members of the Military  3.04%  None  Varies  Not available 
LendingClub Best for Peer-to-Peer Loans  Varies 510  24 to 84 months  $100,000
Consumers Credit Union Best Credit Union  2.24% 640  0 to 84 months  Not available 

Guide to Choosing an Auto Loan Refinance Bank

When to Consider Refinancing Your Auto Loan

It’s a good idea to think about refinancing your auto loan if your credit score has improved since you first took out the loan. A higher credit score can qualify you for lower rates, saving you money on interest over time. However, you may want to hold off on refinancing a loan if your credit score has gone down.

Compare Auto Loan Refinance Banks 

In order to make your auto loan refinance a success, it’s important to choose a bank that meets your needs. Some things to consider when evaluating lenders include:

  • Rates: The lower the rates, the more you’ll save on interest. Be sure to compare multiple lenders in order to lock in the lowest rates possible.
  • Required credit score: Some lenders have minimum credit score requirements.
  • Vehicle restrictions: While some banks and lenders work with all vehicles, others have certain restrictions when it comes to vehicle type, age, and mileage.
  • Prequalification options: If possible, look for a lender that allows you to prequalify for an auto loan refinance without affecting your credit score.
  • Application process: Look for a lender that offers a simple application process and fast funding.
  • Customer service: You should choose a lender with a history of good customer service and high customer satisfaction.

Apply for Your Auto Loan Refinance

Before you apply for an auto loan refinance, you should make sure that your own finances are in order. You should try to establish a high credit score, low debt to income ratio, and a history of stable income before applying for an auto loan refinance.

In order to apply for an auto loan refinance, there are a few documents you’ll need to have on hand. These include personal information like your name, address, and Social Security number, as well as proof of insurance, your current loan and lender information, and your vehicle’s make and model, age, and mileage.

Some lenders may allow you to prequalify and view your loan options before submitting an application. Once you decide on a lender, you can submit your application for an auto refinance loan. In some cases, you could receive funding in as little as one business day.

Frequently Asked Questions

How Does an Auto Loan Refinance Work?

An auto loan refinance is when you replace your current auto loan with a new one, intending to receive a lower interest rate. Your new loan will pay off the old loan, and you will sign new paperwork, have new terms and conditions, and a new interest rate.

You typically choose to refinance your auto loan if you’re unhappy with the rate or terms, or your credit score has gone up significantly since your original loan. Usually, refinancing is to save money, but keep an eye out for refinancing fees.

What Are the Requirements to Refinance an Auto Loan?

Different lenders have different requirements to refinance an auto loan, but most require that you:

  • Wait at least 60–90 days after the original loan so the title on your vehicle has been transferred
  • Meet a minimum credit score set by the lender (typically 660 or higher)
  • Show proof of income and identification documents
  • Have a car under a certain number of miles (some lenders require under 125,000 miles and under 10 years old)

How Much Does it Cost to Refinance an Auto Loan?

Just like each auto lender has different criteria for refinancing an auto loan, they also have different refinance fees. Some auto lenders charge processing and origination fees to do the refinance paperwork, and you may have to pay a prepayment penalty from your original lender. However, other lenders don’t charge any fees, so you will want to find this out ahead of time.

Methodology

We chose the 7 best auto loan refinance banks by first reviewing and researching multiple auto loan refinance banks and then selecting the top contenders. We chose the best options based on credit score requirements, company reputation, available options, rates offered, and more.