Refinance With a Warranty Included in the Payment

by Kelly
(Connecticut)

Question: I currently have a used car loan with the extended warranty jimmied into the monthly payment and I am looking into refinancing the loan and was wondering how I can do that and not have it affect the warranty. I have had the loan for 2 years and it is a 5 year loan.




Answer: I can't speak for all lenders on this one as they will all have different guidelines, but you should have no problem refinancing with a warranty included with the loan as long as the total amount you are refinancing (including taxes, warranty, etc.) is inline with the book value and the percentage of book value they will loan.

For instance, if (including warranty and taxes) you are looking to refinance $10,000 and the book value is $8,000, but the lender loans up to 125% of book value, then they would be willing to loan you the full $10,000^oac (8000 x 125% = 10,000).

If you owed $12,000 under the same scenario, then you'd need to put $2,000 down in order to get the deal inline with the lenders guidelines.

Try MyAutoLoan.com here - "Auto Refinance" - as they work with multiple lenders and will get you up to four competing quotes. Some of their lenders may lend based on the retail value of your vehicle which means you'd be less likely to have to put money down.

Hope this helps,
Justin