Can I Refinance My Car With The Same Lender?

Can I Refinance My Car With The Same Lender

The financial climate has taken a bit of a hit in recent years, and the automotive industry is becoming changeable worldwide.

So, sometimes the idea of financing a vehicle can leave us with countless questions about whether it is actually a wise decision. 

Sometimes our loan terms may not compliment or help our financial situations. It could be time to think about refinancing if this resonates with you. 

Although, for one reason or another, you may not totally feel like you want to change your lender. If this is the case, you may want to renegotiate the terms of your loan with your current loan lender. 

Some of us may start questioning if this is a wise call, or even if you actually can refinance your car with the same lender anyway. 

To put it straight, yes, you can refinance your car with the same lender of your original loan. However, this does not mean that this is the only, or the best choice for you. In most cases it is not. 

Should You Refinance An Auto Loan? 

Back in 2019, we saw a record high of over $1 trillion dollars owed in car loan balances. A huge majority of vehicles are financed now, and the average first-time loan payment is really high. 

This can be way too costly for a majority of people. However, if you find that your financial situation, or your credit score has actually improved since you first applied then you can actually renegotiate your loan. 

If you like your current lender, you can stick with them. So, let’s look at the pros and cons of this. 


Refinancing your car with the same lender can be beneficial as it can; 

  • Lower your overall monthly payments. 
  • Extend or shorten (your choice) the length of your overall loan. 
  • Reduce your APR, which can in turn, reduce the interest you pay over the loan’s life. 
  • If you do change your lender you can find a lender with better payment options. 

There is much good that can come from doing this, however, it is not all sunshine and rainbows. Instead of listing a load of cons though, we will go on to tell you if it is worth it, and why so many people say that it is not always the best option. 

Is It Worth It? 

So, is it worth it? Hmm… Well, even though it is possible to do so, it is not always recommended. 

If you know anything about loans then you will know that a majority of your loan terms are based upon information such as your credit score, the debt Vs income ratio, your financial situation, and the terms of the lender. 

If your credit score has bettered majorly in the last few months then it can be worthwhile for you to seek out a newer lender instead. 

Can I Refinance My Car With The Same Lender (1)

It is better recommended that you seek out a new lender entirely instead of sticking with the same one in this situation because you could capture a better deal and save yourself a chunk of money. 

This is also why you should review your terms with the lender you are currently with, as you may even find that if you pay off a loan early you may be penalized for it. 

That being said there are benefits to refinancing with your current lender, but it does depend on the lender. You might get lower payments, a reduction in the loan duration, a better deal, however, shopping around is worthwhile too. 

There are no limitations to the amount of lenders out there, and so shopping around is worthwhile in the long run, even if your current lender, and you have a solid relationship. 

The whole reason you want to refinance is to get a better interest rate, length of loan, and payment options, so if you only get a deal slightly better than previously, you should explore other potential avenues. 

Factors To Consider

While you may be able to refinance with the same lender, it is not always suitable for your situation. 

Loan terms, interest rates and such are determined by a series of factors. These include factors such as; 

  • Who you are refinancing with (as we have discussed).
  • If you have a cosigner.
  • Your income and debts. 
  • Your credit history, and credit score.

Lenders will offer you terms of agreement, however, these will be different per lender. This is the reason to shop around. Even though refinancing with the same lender may seem simpler and make the most sense to you, it is not always the best deal. 

And, getting the best deal is the ultimate goal here. 

When Should You Refinance

So, now we have to ask, when should you be considering refinancing your car, as there is a good time to do this, and a bad time to do this. 

There are some situations that are good times to refinance a car, so let’s look at these. 

  • You should consider refinancing your car if you qualify for a lower interest rate, in situations where perhaps your credit has improved. If you get a lower rate, you may be able to save a tonne of cash. If you do this with a cosigner, this will also help! 
  • You can also consider refinancing if you seek a lower monthly payment amount. You may be eligible to get a longer term for your loan by doing this. It does mean you will be making payments for longer, but they will be lower. It is ideal if you’re in a tight spot. 
  • Another reason is if your car has a high mileage or if it is older. A car which is over a decade old or approaching 100K miles then you may be able to see if a last financing makes sense to do.
  • Some will restrict you to do this at this time, so getting one last look is not a bad idea.

Is It Easier To Refinance With A Current Lender?

We will often turn to refinancing with a current lender because we assume it will be easier. However, is it? If you apply to do this through your current lender, they will typically have all the paperwork already on hand. 

But you should still look through all this and review the information yourself before you apply to refinance.

You should also check your current interest rate as well to find out if you will get a better deal by refinancing. 

Regardless if it seems easier or not, a little shop around never hurt anybody, and you might find something better elsewhere in doing so.

In some cases, it is not that much harder to switch to another provider as most lenders keep the process pretty standard. 

While it may seem to be easier, easier does not always mean better, sometimes harder means better. 

How To Refinance Your Car With Your Current Lender

How you refinance when you are applying with your current lender will differ than if you do it with a new lender. 

However, you will still need the required documents, and even if you have a good history of paying on time, you will still need to prove your income, be it via tax returns or pay stubs. 

You will need to confirm and update personal information, as well as how much you spend on your accommodation per month. They may also check your credit score, which will cause a short-term dip in your score. 

Once all this is done, you will receive an offer based on the information given. You can review this information and decide if you want to stick to this lender. 

To Conclude

Can you refinance your car with the same lender? Yes, of course you can, but this does not mean that it is always the best idea.

While it may seem easier to do so, it depends on the individual lender. So it is worthwhile shopping around to see what others will offer. 

You may even find a better deal when you shop around. So, don’t stick with one lender just because it is easier.

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