Q:

How do you refinance a GMAC car loan?

A:

Quick Answer

Refinance a GMAC car loan by contacting Ally Financial, which handles all GMAC auto financing, states CarsDirect. Consumers can also contact third-party banks that handle automobile refinancing and inquire about low-interest rate options for owners with GMAC loans, notes Loan.com.

Continue Reading

Full Answer

Refinancing an automobile loan can often lead to saving hundreds of dollars over the entire duration of the loan, according to Cars.com. Car owners with a GMAC auto loan should be wary of prepayment penalties associated with some refinancing deals, because this type of penalty is usually so large it defeats the purpose of restructuring payments. Consumers are not obligated to refinance a GMAC loan with Ally Financial and can shop around online for alternative lenders that offer better refinancing terms. Once the refinancing loan is approved, the old loan is completely paid off, and the payment is sent to the original lender, which does not involve the car dealership.

Consumers who refinance an auto loan have the option to extend the repayment period, which often reduces the monthly payment amount. Accepting extended payments may cause a delay in the consumer's ability to purchase a new car in the future, explains Cars.com. Consumers with poor credit typically pay higher interest rates up to 20 percent if they are approved for auto loan refinancing.

Learn more about Credit & Lending

Related Questions

Explore