SafeAmerica Credit Union

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• By Lisa

Saving Money with an Auto Loan Refinance

We’re all looking for ways to save where we can. Refinancing your auto loan can be an appealing way to lower your auto loan costs. Now is a good time to re-evaluate your finances and find ways to save money. Given the current state of events, many lenders are offering great rates and specials on new auto loans (among other things). It’s the perfect time to see what’s available for you, and most importantly, what can save you money.

My neighbor said an auto refinance was a bad idea, is that true?

Can I save money on an auto loan refinance? What does it take to refinance an auto loan? Is it really beneficial for me?

There are many questions and things to consider but individual credit status is one of the most important deciding factors for getting an auto loan refinance. So to compare with someone else means you are assuming their credit status as your own.

According to Credit Karma, below are some things to consider when looking into easing your finances with an auto loan refinance:

What does an Auto Refinance do?

  • Refinancing means you pay off your current auto loan with a brand new auto loan
  • Based on your credit, it could immediately help free up some of your debt
  • Extending your term means paying more interest, but with lower monthly payments, providing the instant financial relief

What YOU should do

  • An auto refinance serves people differently and is beneficial when you need instant savings
  • Find rates that are lower than your existing auto loan
  • Be aware of your current credit score, any improvement means refinancing will cut your monthly payment
  • Be aware of vehicle criteria lenders may have
  • Know your term and what length works best for your budget
  • A tighter budget means longer terms to pay your loan, but in an affordable manner
  • Know how much you owe on your auto loan and your vehicle’s current market value
  • Be aware of any refinancing fees
  • Understand if your auto loan has any penalties for paying it off early
  • Make sure to have all necessary legal documents readily available
  • Be aware of both hard and soft inquiries when browsing around
  • If you must get multiple hard inquiries done, aim to do so in a span of 14 days. This may only count as a single hard inquiry and not as multiple.

As a member of SafeAmerica Credit Union, you can refinance your auto loan and take advantage of:

  1. Great Rates
  2. Flexible terms
  3. No payments for 60 days

Apply online below and try our payment calculators to see if an auto loan refinance can benefit you.

Learn More
Try Our Calculators

• By Lisa

COVID-19 Credit Check Reminder

The year 2020 has been one for the books. Everyone has been feeling both the direct and indirect effects of the ongoing pandemic. With everything that’s going on, now is a good time to review and understand your good credit with our COVID-19 Credit Check Reminder.

Protecting your credit during COVID – 19

  • Reach out to your internet and phone providers for flexibility with payment options.
  • Reach out to your auto insurance provider for any possible flexibility. Learn more about our auto insurance coverage here.
  • Reach out to lenders for any possible flexibility with payment options. Learn more of our current payment options here.
  • Do your best to pay the minimum on your credit card bills every month.
  • Keep an eye on your credit score for any fraudulent activity.
  • Consider signing up to receive fraud alerts.
  • Reach out for financial assistance with a credit counselor.
  • Make a budget and do your best to stick with it.
  • If you speak with anyone online or via phone, make sure they are someone who could be trusted and working for a trusted company. Learn more on how to protect yourself from COVID-19 scams by clicking here

By keeping a close eye on what information the governor’s office and county officials release, we understand that we are closer to this being over more than before. We also understand that as humans we need to have our minds occupied with personal tasks and objectives to distract ourselves from the possibility of misjudgment stemming from the pandemic.

So let us preoccupy our minds with our COVID-19 credit check to learn some credit basics and position ourselves appropriately for what is next in our financial future.

What makes up your credit score?

35% is payment history
30% is credit utilization/capacity
15% is the length of credit
10% is search & acquisition for new credit
10% is the type of credit

Credit FYI's

  • A good credit score will ONLY benefit you.
  • Do your best to not miss any payments
  • The better your credit, the better rates you will get for car loans, mortgages, credit cards, personal loans, insurance costs and employment opportunities
  • When lenders check your credit they may use any one of the three major credit bureaus, Experian, Equifax and TransUnion
  • Stabilizing your credit will set a foundation to grow
  • Make sure to identify, plan and act upon ways to improve your score
  • Hard credit checks are when lenders use your score to decide your rates
  • Soft credit checks do not impact your credit score since they are not for a line of credit
  • Your credit score is viewed/generated every time a lender requests the information
  • You can check your own score at annualcreditreport.com and it will fall under a soft credit check
  • Do not close credit cards. This keeps your credit utilization looking great. Meaning you have the resources and have paid them off

What is a credit report?

  • Shows amount of debt you have
  • Types of credit you have
  • The length of time you have had credit cards for
  • Hard credit checks stay on your report for a little over two years
  • A good credit utilization rate is below 30%
  • Lenders typically focus on history of on time payments and low credit utilization
  • Credit utilization is how much of your available credit balance you are using

What is a good way to improve credit?

Credit repair companies can only do what you can already do. You can also dispute any incorrect or outdated information.
There are multiple ways to go about improving your credit, but let’s focus on how to improve credit by making the most of credit utilization.
Most people can agree that if you are not using something, you should get rid of it. So when someone pays off their credit card, they may think of closing their credit account right away. However, when it comes to improving your credit, you should consider leaving some credit accounts open. This leaves you to have a bigger pool of credit at your disposal. This is where the importance of credit utilization comes into play. Having a pool of money but only using 30% of it shows lenders that you are responsible with your finances and not blowing through your credit limits.

An example:

You open a new credit card and your limit is $1,000.

What is the most you should spend, ideally?

Up to 30%

So that means…

You should only be spending (borrowing) a maximum of $300 until you pay it off.

Now when you go to pick out a new car and have your credit report checked, the lender will be able to see your credit history and see the card with $1,000 limit and only $300 borrowed, this shows the lender you are financially responsible by not spending your limit or maxing your credit card.

Learn more about:

Auto Insurance by clicking here

COVID-19 business updates by clicking here

COVID-19 Scams by clicking here

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