Are You Paying Too Much for Your Auto Loan?
How refinancing your auto loan with a better rate could lower your monthly car payment.
Buying a car is the second-largest purchase most Americans make – a source of fun and leisure for some, and an essential way of getting to work and getting things done for others. Most people spend hours researching the perfect car to purchase, and 80% of consumers take out a loan to make their purchase. However, many car buyers don’t negotiate their rate and end up paying more than they should. For example, based on data from the Center for Responsible Lending, consumers pay as much as much as $25 billion in interest payments every year due to “dealer mark-up” of their interest rate.
Here at Lending Club we pioneered a better consumer borrowing experience powered by our marketplace model, and now we are bringing a much-needed innovative and more transparent solution to traditional auto loans. The new Auto Refinance product on our platform offers consumers who qualify access to more affordable monthly payments and interest rates.
By lowering their APR by just 2.5%, car owners can save approximately $1,350 on the total cost of their car loans. People who have a car loan and are current have the opportunity to check their rate in minutes with no impact to their credit score and see if we can unlock access to savings.
The process to apply is fast, secure and completely online. Fill out a short application, and Lending Club will present multiple auto refinancing offers, comparing the terms of your offer against the terms of your existing auto loan, so you’ll see in minutes how much you could save. Rates are based on an applicant’s credit history, income and ability to make payments, as well as the term of current loan, the amount financed and current value of the vehicle.
We’re launching access to the product in California first, and plan to expand nationally in early next year. The opportunity – for borrowers and for the Lending Club platform – is huge. In the U.S. there are $1 trillion dollars in auto loans outstanding.
By leveraging technology and transparency, Lending Club is able to pass savings on to borrowers. Since 2007, the personal loan product offered through our platform has helped more than one million customers save $1.4 billion in interest payments. Now, we’re changing the game again with Auto Refinance. Save money by checking your rate today with Lending Club Auto Refinance.
1Center for Responsible Lending: The State of Lending in America & Its Impact on U.S. Households; McKinsey innovation report
2TransUnion Consumer Credit Database, 2015 Auto Refinance Study Data Set
4Based on approximated $1,030 avg. annual savings, calculated based on approximated $13,500 avg. loan size (as of December 31, 2015, standard program borrowers only), and 760 basis points average savings. Average savings based on responses from 12,728 borrowers in a survey of 66,493 randomly selected borrowers conducted by Lending Club from January 1, 2015 – January 1, 2016. Borrowers who received a loan to consolidate existing debt or pay off their credit card balance reported that the interest rate on outstanding debt or credit cards was 20.7% and average interest rate on loans via Lending Club is 13.8%. Unsecured loans via Lending Club feature rates from 5.99% to 35.89% APR and origination fees from 1% to 6%. Average origination fee is 5.13% as of Q2 2016. Best APR is available to borrowers with excellent credit.