How Much Could You Save by Refinancing Your Auto Loan With a Credit Union?
If you financed your vehicle through a dealership or another lender, there’s a good chance you’re paying more than you need to each month. Auto loan refinancing gives you the opportunity to replace your existing loan with a new one—often with a better rate, lower payment, or more favorable terms.
The Benefits of Auto Loan Refinancing
Refinancing your car loan can offer both short- and long-term financial benefits. Some of the most common reasons people choose to refinance their car loan include:
Lowering their interest rate — Even a modest reduction can save you hundreds, or thousands, over the life of your loan.
Reducing their monthly payment — Spreading your balance across a longer term could give your budget some breathing room.
Paying off their loan faster — Switching to a shorter term might increase your monthly payment slightly but cut down on overall interest paid.
Improved customer experience — If you’ve been frustrated by poor communication or surprise fees from your current lender, refinancing gives you a chance to work with someone new.
More manageable debt — In some cases, refinancing can help you avoid late payments or default by resetting your loan on terms that work better for your current financial situation.
Why Refinancing Through a Credit Union Is a Smart Move
If your current loan came from a dealership or large national lender, you may have been locked into a higher rate than you could’ve gotten elsewhere. That’s especially true if your credit score has improved since the time of purchase—or if you accepted dealer financing for convenience without comparison shopping.
Credit unions operate as not-for-profit institutions, which means they return earnings to their members in the form of lower loan rates, fewer fees, and more personalized service. You’re not just a customer—you’re a member. That translates to:
More competitive rates than big banks or dealership lenders.
Local decision-making and faster approvals.
Real people to talk to when you have questions or concerns.
If you're currently making auto loan payments to a large out-of-town lender, refinancing with a northeast Louisiana credit union could bring your loan closer to home—while saving you money along the way.
How Much Could You Actually Save?
Your savings will depend on factors like your current rate, the size of your loan, and how much time is left on it—but even small reductions can add up quickly.
Let’s say you financed a $25,000 vehicle at 8% interest over 60 months. Your monthly payment would be about $507, and you’d pay roughly $5,400 in interest by the end of the loan.
If you refinance after a year into a 60-month loan at 5%, your new payment could drop to around $452—and you’d save more than $1,800 in total interest over the remainder of the loan.
Now imagine combining those savings with Ouachita Valley FCU’s limited-time offer: 1% cash back and 90 days with no payments on auto loan refinances, available through May 9, 2025. You could free up your monthly budget, reduce your loan cost and get a little extra money back—all by making the switch.
*Membership restrictions apply. To qualify for offer for refinance, loan must be from another financial institution. Offer for qualified buyers. Interest accrues from date of the loan. APR = Annual Percentage Rate. 1% cash back based on purchase price of vehicle, limit $500. See credit union for details. Offer ends May 9th.
What the Process Looks Like
Refinancing is typically faster and easier than the initial car loan application process. Once you decide to move forward, you’ll:
Fill out a short application with your credit union
Provide a few basic documents, like proof of income and details about your current loan
Wait for the credit union to review and approve your new loan
Let them handle paying off your existing lender
After that, you’ll simply begin making payments on the new loan with your credit union—often at a lower rate or with better terms.
Is It Time to Refinance Your Car Loan?
If you're not sure whether your current loan is working for you, contact Ouachita Valley FCU. We can help you determine if lower rates or terms that work better for your budget are available to you. Call us at 318.387.4592 to learn more.
