It certainly is possible to refinance a used car as long as you and your vehicle meet the lender’s refinancing requirements. Each lender has their own rules for refinancing, but they generally all share six qualifications which determine whether or not you can refinance a used car.

3 Refinancing Requirements Your Vehicle Must Meet

Lenders don’t automatically refinance any and every vehicle – each car must meet their refinancing requirements, and this may be a concern to you if you bought an older used model.

Just as we noted, the specifics vary by lender, but they generally all share these three vehicle refinancing requirements:

  1. Is it Possible to Refinance a Used Car?Car can’t have negative equity – Your used vehicle must have equity, meaning it needs to have an actual cash value that’s equal to or more than the loan balance. If the value is less than you owe, you have negative equity and aren’t going to qualify.
  2. Car must meet age and mileage requirements – Most lenders don’t approve vehicles older than 10 model years or with more than 100,000 miles on the odometer. However, both of the specific numbers can vary. To know for sure, ask about the lender’s age and mileage rules ahead of time.
  3. Car must have a clean title – Your used vehicle must not have a branded title, including rebuilt, salvage, junk, flood damaged, fleet, stolen, or mileage unknown.

3 Refinancing Requirements You Must Meet

Besides your used car meeting the lender’s requirements, you need to qualify for refinancing as well. Here are three other refinancing requirements to be aware of:

  1. Your credit score needs to have improved – You typically need to have a good credit score in order to get approved to refinance. Lenders may make an exception if you originally took out a bad credit car loan. You may be able to qualify if your credit score has improved since you took out the original loan, even if it's not at a point that's considered "good" yet.
  2. You can’t be behind on payments – You must be current on your monthly car loan payments in order to get approved to refinance.
  3. The amount being financed must meet the lender’s limits – The balance being refinanced must fall within the lender’s acceptable range.

If you're struggling with your monthly payment, it's important that you talk to your lender. You may be able to refinance and extend the loan term. This drops your monthly payment, making it a good short-term fix if you need time to get your finances back on track. However, extending your loan term also increases the overall cost, so be aware of this trade-off.

Refinancing or Auto Loan Help

If you’re looking for some assistance with refinancing a bad credit auto loan, our trusted partner can help you view and compare refinancing offers online.

If you don’t need to refinance right now and simply need an auto loan, Auto Credit Express can assist with that. We work with a nationwide network of dealerships that have bad credit lenders available.

We'll work to match you with a dealer near you if you get started by filling out our free and simple car loan request form.