Earlier this year, a Community Focus member came to us looking for help refinancing an auto loan held with another lender. At the time, the loan carried an interest rate of approximately 21% APR*.
The member's credit score was in the low 500s, and there were some past-due and charged-off accounts on the credit report. At that point, the member's refinancing options were limited.
Instead of simply saying no, our lending team talked with the member about steps that could potentially put them in a stronger financial position.
A Plan — and a Second Chance
The member focused on paying off charged-off accounts and bringing other accounts current.
Then, a few months later, the member came back to Community Focus.
The difference was significant.
The member had followed through on the plan, the accounts had been addressed, and the credit score had improved by approximately 60 points.
With a stronger credit profile, we were able to take another look at the auto refinance.
The Result: About $220 Less Per Month
This time, the outcome looked very different.
The member was able to refinance the auto loan from approximately 21% APR* to about 9% APR* without extending the remaining loan term.
That lowered the monthly payment by approximately $220 and resulted in projected savings of more than $15,000 over the remaining life of the loan.
That's money that can now stay in the member's monthly budget instead of going toward a higher auto payment.
Sometimes "Not Yet" Isn't the Same as "No"
That's what makes this story important.
When the member first came to us, refinancing wasn't the right option. But that didn't have to be the end of the conversation.
Our team helped identify steps the member could take to improve their situation. The member did the work, came back and ultimately achieved a much better result.
At Community Focus Federal Credit Union, we believe financial guidance should be part of the relationship. If we can't provide the solution you're looking for today, we can help you better understand the factors affecting your options and what steps may help you move forward.
If you're paying a high interest rate on an auto loan, it may be worth having a conversation with us.
Talk with Community Focus about your auto refinancing options today.