What Bank of America offers for car loan refinancing
Bank of America does not originate new auto loans or refinance existing car loans through its standard retail banking channels. If you have a Bank of America auto loan already, you cannot refinance it with Bank of America itself. However, Bank of America customers can refinance a car loan from another lender by taking out a personal loan or auto loan through a different financial institution and using those funds to pay off the existing loan.
If you are a Bank of America customer looking to refinance, you have two main paths: use another lender's auto refinance product, or explore Bank of America's personal loan option as an alternative way to consolidate debt. A personal loan from Bank of America could theoretically be used to pay off an auto loan, though the interest rate and terms would depend on your credit profile and the loan amount you request.
The key distinction is that Bank of America is not the refinancing lender in either scenario — it is either a source of personal loan funds or straightforward your existing bank. The actual auto refinance would come from a credit union, online lender, traditional bank, or captive finance company.
Key Takeaways
- Bank of America does not offer auto refinancing products, so you must refinance through a different lender if you want to lower your rate or change your loan terms.
- Bank of America customers can use a personal loan from Bank of America to pay off an existing auto loan, though this is a workaround rather than a dedicated refinance product.
- To refinance a car loan, you will need to explore with a credit union, online auto lender, or another bank that actually offers auto refinancing.
- Your Bank of America checking or savings account status may help you get approved for a personal loan, but it does not change the fact that you are refinancing through a different institution.
Using a Bank of America personal loan to pay off a car loan
If you are a Bank of America customer with an existing auto loan elsewhere, you can request a personal loan from Bank of America and use the funds to pay off the original loan. This is not the same as refinancing — you are taking out a new loan type with a different lender — but the end result is similar: you pay off the old loan and owe money to Bank of America instead.
The interest rate on a Bank of America personal loan depends on your credit score, income, debt-to-income ratio, and the loan amount. Personal loans typically carry higher interest rates than auto loans because they are unsecured (not backed by the car as collateral). Before you pursue this route, compare the personal loan rate Bank of America offers you against the rate you could get from an actual auto refinance lender. An auto refinance will almost always be cheaper because the lender holds the title to your car.
To explore this option, log into your Bank of America online account or visit a branch and ask about personal loan rates and terms. You will need to provide income verification and authorize a credit check. If approved, the funds are typically deposited within a few business days, and you can then pay off your existing auto loan in full.
Where to refinance your car loan instead
Since Bank of America does not offer auto refinancing, you will need to shop with lenders that do. Credit unions often offer the lowest rates, especially if you are a member or can join one through your employer, school, or community. Online auto lenders like LendingClub, Lightstream, and others specialize in refinancing and can provide quotes in minutes. Traditional banks such as Wells Fargo, Chase, and US Bank also offer auto refinancing to existing customers and non-customers alike.
Captive finance companies — the lending arms of car manufacturers like Ford Credit, GM Financial, and Toyota Financial Services — sometimes offer refinancing to customers who financed their purchase through the same company. These lenders already hold your loan and may offer rate reductions as an incentive to stay.
The refinancing process with any of these lenders is straightforward: you provide your current loan details, the lender pulls your credit, offers you a rate and term, and if you accept, they pay off your old loan and you begin making payments to them. The entire process typically takes one to two weeks from process to funding.
What information you will need to refinance
When you contact a refinancing lender, have the following details ready: your current loan account number, the name of your current lender, your vehicle identification number (VIN), the current payoff amount of your loan, and the original purchase price or current market value of the car. Lenders use this information to verify the loan exists, confirm you are the borrower, and assess the value of the collateral.
You will also need to provide personal information: your Social Security number, date of birth, current address, employment status, and income. The lender will run a hard credit inquiry, which temporarily lowers your credit score by a few points. If you are shopping with multiple lenders within a short window (typically 14 to 45 days, depending on the credit bureau), multiple inquiries count as a single inquiry for scoring purposes, so do not hesitate to get quotes from several places.
Reasons to refinance away from your current loan
The most common reason to refinance is a lower interest rate. If your credit score has improved since you took out the original loan, or if market rates have dropped, refinancing can reduce your monthly payment and the total interest you pay over the life of the loan. Even a 1 percent rate reduction can save hundreds of dollars on a typical auto loan.
Other reasons include changing the loan term — extending it to lower your monthly payment if you are struggling, or shortening it to pay off the car faster and save on interest. Some borrowers refinance to remove a co-signer from the original loan, or to switch from a variable-rate loan to a fixed-rate loan for payment predictability.
Refinancing makes the most sense if you have paid down at least 20 percent of the original loan balance and your car is worth more than you owe. If you are underwater on the loan (owe more than the car is worth), refinancing is harder and more expensive because lenders see higher risk.
When refinancing does not make financial sense
If you are within the first year of your loan, refinancing may not save you money because you are still paying mostly interest. Refinancing resets the clock and restarts the interest-heavy portion of the amortization schedule. Additionally, if your credit score has dropped since you took out the original loan, you may not may have access to for a better rate, making refinancing pointless.
Refinancing also costs money in some cases. Some lenders charge origination fees, and your current lender may charge a prepayment penalty for paying off the loan early (though federal law limits these penalties). Before you refinance, calculate whether the savings from a lower rate outweigh the costs of refinancing.
If you are close to paying off your current loan — within 12 to 18 months — refinancing usually is not worth the effort and cost. The remaining interest you would pay is already minimal, and the new loan would extend your payoff date unless you make larger payments.
How to compare refinancing offers
When you receive offers from multiple lenders, compare the annual percentage rate (APR), not just the interest rate. The APR includes fees and gives you a true picture of the cost. Also compare the loan term (36, 48, 60 months, etc.), the monthly payment, and the total amount you will pay over the life of the loan.
Use an auto loan calculator to see how different rates and terms affect your bottom line. A lower rate with a longer term might have a lower monthly payment but cost more overall. A higher rate with a shorter term might have a higher monthly payment but save you money in total interest.
Check whether the lender allows early payoff without penalty. Some lenders charge a fee if you pay off the loan ahead of schedule, which limits your flexibility. Also confirm that the lender will pay off your current loan directly — you do not want to receive a check and have to manage the payoff yourself.
Frequently Asked Questions
Can I refinance a Bank of America auto loan with Bank of America?
No. Bank of America does not offer auto refinancing. If you have a Bank of America auto loan, you must refinance it through a different lender such as a credit union, online lender, or another bank. You can then use the new loan to pay off the Bank of America loan in full.
Will refinancing hurt my credit score?
Refinancing causes a small, temporary dip in your credit score due to the hard inquiry and the new account. The score typically recovers within a few months. The long-term impact is usually positive because you are replacing an old loan with a new one, which can improve your credit mix and lower your overall debt.
How long does it take to refinance a car loan?
The process typically takes one to two weeks from the time you submit your process to the time the new lender pays off your old loan and you receive your first statement. Some online lenders can move faster, while banks may take longer due to verification steps.
What if I still owe more than my car is worth?
Refinancing is more difficult if you are underwater on your loan, but not impossible. Some credit unions and online lenders will refinance negative equity loans, though you may face a higher interest rate or be required to make a down payment to cover part of the gap. Shop around before assuming you cannot refinance.
Do I need to be a Bank of America customer to refinance my car loan?
No. You do not need to be a Bank of America customer to refinance a car loan. You can refinance with any lender that offers auto refinancing, regardless of where you bank. Being a Bank of America customer may help you get approved for a personal loan from them, but it does not affect your ability to refinance with other institutions.