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Refinancing your car typically involves replacing your existing auto loan with a new and improved one. For example, you may be able to get a new loan with a lower interest rate or reduced monthly payment amount.
But what exactly do you need to refinance your car, and will you qualify?
While the loan origination process varies between lenders, there are a few common themes. From credit scores and loan amounts to essential documents, here are the typical requirements you should know.
Our team evaluated 16 auto loan refinancing providers to compare 13 common requirements. These requirements included maximum age limits, minimum and maximum loan amount limits, required documents, minimum monthly income limits, maximum DTI ratios, maximum mileage limits, minimum credit score limits, minimum vehicle value limits, maximum LTV ratios, minimum time with the current loan limits, minimum remaining term limits and vehicle exclusions.
Information was collected from lenders and aggregate websites in November 2024.
Credit is one of the first things lenders check when you apply to refinance your vehicle, and income is usually close behind.
Most lenders don’t have public-facing minimum credit score requirements for refinancing a car. Instead, they encourage you to apply so they can assess your full financial situation. However, when minimums are set, they often are around 600. This suggests that at least fair credit may be required to refinance your auto loan.
Before applying, check your credit to see where it stands and ensure everything on your report is accurate. You can get free weekly credit reports from the three major credit bureaus at AnnualCreditReport.com, and free credit scores from providers like Experian, Capital One and Equifax.
Better credit scores often lead to better interest rates. To see how those rates affect your loan options, use our auto refinancing calculator.
Lenders assess your debt-to-income (DTI) ratio — the percentage of your monthly income that goes towards recurring debt payments — to gauge your ability to afford a new loan. In most cases, they’ll prefer DTI ratios under 35%, but each lender’s requirements are different.
To calculate your DTI, divide your total monthly debt payments by your gross monthly income. For example, if your gross monthly income is $6,000 and your monthly debt payments total $2,000, your DTI ratio would be 33%. If yours is too high, you may need to pay off some debt before refinancing.
Beyond credit and income, auto loan refinance lenders will want to check out your vehicle. They’ll often look to factors like make, model, age, condition and mileage to ensure it’s reliable collateral.
Lenders commonly impose age and mileage restrictions on vehicles. In many cases, your vehicle must be less than 10 years old and have less than 100,000 to 150,000 miles to qualify.
That said, some lenders are more flexible, so you may still be able to refinance if your car is older or has higher mileage.
Some lenders place restrictions on the types of vehicles they refinance. For example, they may not allow certain makes or models, and many only refinance personal-use automobiles — no commercial vehicles or other vehicle types like motorcycles or recreational vehicles. Further, vehicles typically won’t qualify if they’re salvaged, have branded titles or have a history of chronic issues.
The equity you have in your vehicle is another factor to consider. Lenders divide your outstanding loan balance by your vehicle’s current fair market value to get your loan-to-value (LTV) ratio.
If you owe more than your vehicle is worth, the negative equity may make it harder to get approved. Some lenders are willing to roll a limited amount of negative equity into a new loan while others aren’t.
You also run into requirements regarding your current auto loan and lender when trying to refinance your car loan.
Some lenders won’t refinance their own loans or loans from lenders that don’t meet their requirements. For example, they may require issuing lenders to:
Check with potential lenders early to ensure your current lender qualifies.
Before you can refinance, the title transfer to your current lender needs to be complete. Once that’s done, you’ll be able to refinance with most lenders. Some may require you to wait a certain amount of time, such as one to six months. Others may not specify a specific amount of time but want to see an established track record of on-time payments.
Another common requirement for refinancing a car relates to what’s left on your current loan. Lenders want to earn enough interest from a new loan to make it worthwhile, so they often have minimum term and loan amount requirements. For example, a lender may only refinance loans of at least $5,000 that have at least 24 months left in their terms.
Payment history is also a common factor in refinancing. Lenders will usually be able to see the payment history on your current auto loan when they check your credit reports.
If you have missed or late payments, potential lenders may deny your application. As stated above, some look for a certain number of on-time payments before they approve you.
So, what do you need to refinance a vehicle? Here are the documents you should have ready to go as you begin the process:
While these are common document requirements, check with specific lenders to confirm what they’ll need.
When considering auto loan refinancing, it’s important to shop around. Every lender sets different requirements for refinancing a car, and some may be more beneficial to your situation than others. For example, if your vehicle is 11 years old and has 110,000 miles, you’ll want to look for a lender that’s lenient about vehicle age and mileage.
A good place to start is to assess your needs and situation. From there, you can shortlist lenders that look like good fits and collect quotes to see which offers you the best deal.
Want to learn more? Here are answers to some common questions about what’s required when refinancing an auto loan.
You may be disqualified from refinancing your car loan for many reasons. For example, you could get denied if your credit score is too low, your LTV ratio is too high, you have late payments on your current loan or you have a vehicle over 10 years old.
There is no universal minimum credit score required to refinance a car. While a few lenders have minimum credit scores, often around 600, most don’t. However, you’ll generally need at least fair credit to qualify for favorable terms.
Lenders typically request pay stubs from the last two pay periods to verify your income if you're an hourly or salaried employee.
When you apply to refinance a car, lenders generally check a variety of factors such as your credit, income, DTI ratio and LTV ratio. They may also consider details about your current lender, loan and vehicle.
What is the best time to refinance a car loan? Explore the key factors that indicate it might make sense to seek a new auto loan.
