Auto refinance doesn't involve a professional, onsite appraisal of your automobile's worth. The lender will use information that you provide along with Kelly Blue Book value.
Vehicle Appraisal
Do I need to have my automobile's current worth professionally appraised?
Overview In many ways, an auto refinance loan is very similar to a mortgage refinance.
When looking at mortgage refinance, at a high level, one lender will review your existing loan with another lender, and decide to assume the loan - presumably at a lower interest rate. One of the factors that a mortgage lender will need to perform its analysis is to appraise the worth of your house. To do this, a professional appraisal will need to be performed, which will cost you money. Typically these appraisals will cost between $150 to $300. A quick and dirty way to get a comparable on your home is to checkout what other similar houses in your area have sold for within the past 6 months or so by using Zillow.
Putting a value on your car
Just like with mortgage refinance, an auto refinance lender will also need to appraise the worth of your car. If you've read our other articles, then you'll know that determining loan-to-value (LTV) is very important for the bank to assess. This is a relative gauge for the risk associated with providing a loan against a piece of collateral. Bank's want to make sure that they keep the loan size within 100%-130% of the car's value. In simplest terms, the collateral needs to be worth approximately the same amount (or less) when compared to the loan in order to mitigate asset risk.
No onsite appraiser required
Unlike mortgage refinance, you do not need to hire a professional to appraise the worth of your car. Banks will usually use Kelly Blue Book value (or similar agency) to determine the value of your car. The bank will pull this report on your behalf as they evaluate your loan. There are auto refinance fees and no obligation for you to do anything beyond filling out the auto refinance application.
