AAA: 61% of Consumers Unaware Auto Loan Refinancing Involves No Fees

24 January 2011
 

 

CONTACT: For your local media contact visit www.AAA.com/Media

Angie LaPlant, director, Media Relations, AAA Auto Club South, (813) 289-5982 office, (813) 728-7188 cell, ALaPlant@AAASouth.com
 

AAA: CONSUMERS NOT STUCK WITH HIGH INTEREST RATES; NOW IS THE TIME TO REFINANCE AUTO LOAN

Interest rates provided through dealership are typically marked up 2 to 3 points and provide additional profit to the dealer

TAMPA, Fla. (Jan. 24, 2010)—As the economy recovers and the credit market stabilizes, interest rates have dropped to record lows. Now is the time for consumers to take advantage of the low rates, refinance their auto loan, and set the stage for a year of savings. A recent AAA Consumer Pulse™ survey showed the majority (61%) of respondents are unaware refinancing an auto loan can typically be done without extra fees or charges. 

 

The survey also showed a high percentage of motorists (42%) financed their auto loan through the dealership. Moreover, 37 percent of respondents said they have an interest rate of five percent or higher.

“Many interest rates provided by dealers are marked up two to three points. Much of this mark up is additional profit the financial institution allows the dealership to keep,” said Jill Perry, director, AAA Financial Services. “This encourages the dealer to send the loan through the financial institution that makes it most profitable for them.”

 

The easiest way to save money is to refinance an auto loan to reduce the monthly payment and save thousands on total interest paid. The majority of respondents (55%) said they have another 13 months to three years of auto loan payments, and 92 percent have not refinanced their vehicle since 2008. Now is a key time for consumers in this situation to refinance their vehicle and save.

As of July 2010, AAA Financial Services saved members an average of $1,139 over the life of their refinanced auto loan as compared to other refinance lending platforms with a 2.75% APR based on a 48-month term on 2008 and newer vehicles.

 

Refinancing an Auto Loan

  • One of the simplest loans to refinance is an auto loan
  • Consumers can refinance an auto loan before the first payment is due in order to start the savings process immediately
  • The application process can be done online and in many cases the entire transaction completed in as little as one day
  • Typically, there are little to no fees involved in auto loan refinancing and in most cases no appraisal required
  • There is no cost to apply for an auto loan refinance
The AAA Consumer Pulse™ survey was conducted online among residents living in AAA Auto Club South territory from October 20-24.  A total of 653 residents completed the survey. The survey has a maximum margin of error of +/- 3.8 percentage points.  Overall survey responses are weighted by gender within state to ensure reliable and accurate representation of the total U.S.population, 18 years of age and older in Florida, Georgiaand Tennessee.

 

AAA Auto Club South has 79 branch offices serving more than 4.1 million members in Florida, Georgia, West and Middle Tennessee and Puerto Rico. Since its founding in 1938, AAA Auto Club South has worked to protect and advance freedom of mobility and improve travel safety.

 

 

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AAA Auto Club South, 1515 N West Shore Blvd, Tampa, FL33607-4505United States