Refinancing your vehicle loan can be an effective way to reduce your interest rate, monthly payment, or both. Trading in your vehicle at Truck Town in Bremerton, WA may also help you obtain relief from your current monthly payment. However, there are some key differences between the two options that you need to know about.
When you refinance your existing loan, you're essentially exchanging your current loan for a new one. The existing loan is paid off by your new lender, and you will then make payments to the new lender as set forth by the loan agreement.
In such a scenario, you keep the car assuming that you continue to make payments. When a trade occurs, you give your current vehicle to a dealer in exchange for one off of its lot. Any equity that you have in your current vehicle can be used as a down payment.