You might consider refinancing your auto loan in several circumstances, including when:

• Your income, credit, and/or debt-to-income ratio have greatly improved. In other words, you present less risk as a borrower compared to when you first took out the auto loan.
• Interest rates have dropped in general.
• You realize your current lender charged you a higher interest rate than you could have qualified for (e.g., if you originally financed through a dealership).
• You want to remove a cosigner but can’t or don’t want to do so via a standard release.

You may also consider refinancing your car loan when you can’t keep up with payments for your current loan, but you should first consider other options.

Lower monthly payments from a refinanced car loan are usually achieved as the result of a loan term, which can mean paying more over the life of the loan, even if the new interest rate is lower. Meanwhile, the car is depreciating in value.