Is it true that… Sometimes in an attempt to close a deal and take some of the fear out of a high interest rate car loan, some dealers will inform the customer that after 1 year of good repayment history they can come back and either renegotiate the loan on the same vehicle or trade in their vehicle and get a better interest rate on a different vehicle.
Automotive lenders will not cancel and re-write a loan on the same vehicle. The original contract would have to be completely paid out in order for the customer to be able to take advantage of a better rate. It is true that after 1 year of payments most non-prime lenders will re-approve you at their best rate. However, most people are in a heavy negative equity position at this point in their finance contract. Meaning that they owe a much larger amount than they actually value of their vehicle at this time. Banks will finance some of this negative equity but often the negative equity position exceeds both what the bank will finance and what the customer payment tolerance is.
At Car Loans Kingston we strive to put our customers into vehicles and help rebuild their credit. We will always try to trade our customers out of a high interest car loan as early as possible but we will not make risky predictions or false promises in order to do so. So if you are in a position where your only option for a car loan is a high risk one, call me today to get the straight talk on getting you into a car and improving your credit position as effectively and inexpensively as possible. Have questions? Contact us today at 613-549-8900. http://www.carloanskingston.ca/