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Car loan refinancing

Want to get a better deal on your car loan? Consider refinancing.


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Car loan refinancing can help save you money, by giving you a lower rate, fewer fees and more flexibility.

Find out if refinancing is right for you and compare your options now.

Car loans you can use to refinance

Name Product Interest Rate (p.a.) Min. Loan Amount Max. Loan Amount Loan Term Establishment Fee
The Lending People Car Loan
6.99% - 26.99%
1 to 7 years
Varies with lender
Secured and unsecured car loans of up to $75,000 from a variety of reputable lenders. Eligibility: Be 18+, an NZ citizen, resident, or have a valid NZ work visa, and must earn at least $500 per week.
Simplify Secured Car Loan
6.50% - 14.50%
12 - 60 months
$100 - $500, depending on loan amount, lender and term
Secured vehicle finance from $5,000 to $500,000. Eligibility: Must be 18+, a New Zealand resident or permanent citizen and have an income of at least $500 per month.
MTF Finance Secured Car Loan
8.45% - 20.45%
3 - 60 months
Secured car loans from $2,000. Eligibility: Must be 18+, be an NZ citizen, resident or have a work visa, and have a regular source of income.
Pioneer Finance Secured Car Loan
11.95% - 27.95%
Up to 7 years
$270 - $780 depending on size and security
Secured vehicle loans from $1000 - $100,000. Eligibility:Be 18+ (may need a guarantor); be a NZ citizen, resident or have a relevant work visa; have a regular source of income.
Lending Crowd Secured Car Loan
6.49% - 16.78%
3 or 5 years
$250 - $1,450 depending on the amount borrowed
Borrow $2,000 to $200,000 for your chosen vehicle. Eligibility: Be an 18+ NZ permanent resident, have a good credit history and collateral/security.
CarFinance2U Car Loan
8.95% - 23.95%
1 - 5 years
With a CarFinance2U secured or unsecured car loan you could get pre-approval for your next car in 30 minutes. Eligibility: Be at least 22 years old, have a valid NZ driver's licence and be and NZ citizen or permanent resident.
CarPow Secured Car Loan
8.95% - 23.95%
Up to $495
Secured car loans from $3,000. Eligibility: Be 18+, hold a New Zealand Driver’s licence, and earn at least $500 per week.
Nectar Unsecured Car Loan
8.95% - 29.95%
6 months - 4 years
Unsecured car loans from $1,000 with payouts made within one day of approval. Applications entirely online. Eligibility: Must be 18+, an NZ citizen or permanent resident, and have an income of $400 per week or more (after tax).
Stadium Finance Secured Vehicle Loan
9.95% - 19.95%
Up to 60 months
Secured loans from $3,000 and funds paid within one day of approval. Eligibility: Must be 18+ and earning at least $500 per week
Swoosh Finance Secured Car Loan
6.35% - 18.95%
Up to 5 years
Varies with lender
Secured loans up to $100,000 with a quick turnaround time upon approval. Working visa and beneficiary applicants accepted.

Compare up to 4 providers

How does car loan refinancing work?

Car loan refinancing is switching from your current loan to another one. You should change to a loan that gives you lower rates, fewer fees or more straightforward repayment options to help you pay it off sooner or at a lesser cost.

You use the new loan to pay off the existing one and then continue to make repayments on the new loan. If done correctly, refinancing your car loan can potentially save you hundreds, if not thousands, of dollars.

You can either look for the refinancing yourself or enlist the services of a finance broker, who works on your behalf to get the best option.

Why should I refinance?

If you’re still sitting on the fence about whether refinancing your car loan is a good idea, here are a few benefits to consider:

  • Reduce your repayments. Your new loan may offer lower rates and fees, meaning your repayments are smaller.
  • Get a different loan term. You can choose to refinance with a new loan term, which can give you longer to pay off the loan amount.
  • Make the balloon payment more manageable. If you are currently paying off dealer finance, it’s likely you have a balloon payment to cover when the loan ends. Refinancing allows you to pay off your balloon payment over an extended period if you can’t repay the final lump sum.
  • Change lenders. If you’re unhappy with your current lender or would prefer a different one, refinancing allows you to choose a new loan provider.

Steps to refinance your car loan

  1. Check whether the lender charges a fee for closing your loan before the end of the term. If it does, make sure you factor this in when working out if refinancing saves you money.
  2. If you want to go ahead and refinance, you then need to compare your options. Make sure you meet the eligibility criteria and are aware of all fees and charges. Once you find the right loan, click “Go to Site” to apply.
  3. Select “refinancing” as the loan purpose.
  4. Submit the relevant documents and information. You usually need to include information about the lender you’re with and details about your car.
  5. Pay off your previous loan. Your new lender may do this for you, or you may need to organise this yourself.
  6. Close your previous loan. Once you pay off the old loan, you should also ensure your previous lender closes the account.

Main points to consider when refinancing

  • Are you repayments less? It is essential that you check this detail. Less interest does not always mean lower payments, so remember to take into account upfront and ongoing fees as well as the loan term you’re asking for, and use a comparison rate calculator to determine the cheaper option.
  • You don’t pay more interest over the loan term. If you extend the loan term, you may end up paying more in interest throughout the loan, despite lower repayment amounts.
  • The loan has the features that you want. If you wish to make extra repayments; repay the loan early; use a redraw facility or an insurance product bundle, make sure the new lender offers this.
  • The lender is legitimate. Many lenders operate in the car finance space, and it is your responsibility to choose one that is reputable. See how transparent the lender is with rates and fees and how easy they are to contact before deciding on a new loan.

How to compare car loans when you want to refinance

If you decide to refinance, bear the following in mind when comparing loans:

  • Interest rate. Make sure you compare the interest rate across all the car loans available to you. The lower the interest rate, the better, so try and find a loan that gives you a low interest rate to help save you money.
  • Flexibility in repayments. Flexibility in repayments is a significant comparison point. Can you make weekly, fortnightly or monthly payments? It’s also essential to check if the car loan allows you to make additional repayments so that you can pay off your car loan quicker. If repayment flexibility is vital to you, ensure the lender offers the options you need.
  • Additional fees. Most refinancing loans have fees you may be liable to pay. Understand all the costs you may have to pay both upfront and over time and look for a refinancing option with the least fees to help you save money throughout the loan term.
  • Maximum loan amount. Each refinancing option may have different maximum loan amounts that you can borrow. If you have a specific figure in mind, look for a loan that allows you to borrow this amount.

Benefits and drawbacks of refinancing

  • Lower interest rate. One of the advantages of refinancing is securing a lower interest rate. As with any loan, interest typically accounts for the highest cost. Keep an eye out for a car loan with a lower interest rate than you are currently paying. Interest rates tend to fluctuate, so it’s about selecting the right time to refinance to get the lowest rate.
  • Lower repayments. You can lower your repayments by extending your loan term when you refinance, which is good for those who are struggling to make regular repayments every month due to their financial situation. Adding additional years onto your car loan lowers your payments and frees up some much-needed cash.
  • Get more features from your car loan. Refinancing your car loan may also mean you benefit from additional features on the car loan that you don’t currently have, which can include making extra repayments or a redraw facility, where you can redraw these repayments when you need funds the most.
  • May end up paying more interest over the term of the loan. Even if you refinance with a lower interest rate, you may end up paying more in interest if you extend the loan term. You should calculate how much you will pay over a longer term before deciding if it’s right for you.
  • Exit and set-up costs. Switching from your current car loan may incur exit costs. You may also be liable for set-up charges with your new car loan. These are both additional costs and cons that you need to consider.

Picture: Shutterstock

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