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Nissan is a popular vehicle maker in Canada, making up nearly 7.4% of all new car sales in Canada in 2021. Canadian car owners appreciate Nissan’s wide range of models, vehicle safety track record, innovative designs and technology, and overall value for the money.
Nissan Canada Finance (NCF) makes it easy to cover the cost of an automobile purchase with its wide array of financing and lease options. If you already own a Nissan and are looking to cut down on your current monthly car payments or speed up the process of paying off the loan, a refinance may be something to consider.
Let’s go into a little more detail about why refinancing might make sense, and how to go about refinancing your Nissan auto loan.
If you financed the purchase of a Nissan with the car manufacturer’s finance department, you can refinance the loan if you need to. Refinancing might help you lower your interest rate, thereby reducing your monthly payments. It can also be an opportunity to extend the loan term to keep your monthly payments low, or shorten the term to help you become debt-free sooner rather than later.
If you’re looking to refinance your Nissan car loan, consider one of the following options:
Use an online loan aggregator to see what different car loans are offered by various lenders. This will give you an opportunity to find out where the lowest rates and best loan terms are based on your credit score and income.
If you have a strong credit score, you may be able to qualify for a lower interest rate compared to what you’re currently paying. Once you find the right lender to work with, you’ll need to apply for a refinance as you did with your first car loan.
This entails completing an application and providing various documents, such as bank statements, pay stubs, tax receipts, a letter of employment, and anything else the lender may request to verify your creditworthiness and financial health.
You can use the funds from a personal loan to pay off your existing car loan. This option makes sense if you can secure a lower rate on your personal loan, leaving you with lower monthly payments and less interest paid overall.
If you have good credit, you may be able to secure a lower rate with a bank or credit union. If your credit needs improvement, however, you may have to apply for a personal loan with an alternative lender.
Keep in mind that bad credit loans with alternative lenders come with much higher interest rates compared to traditional loans from conventional lenders. If the rate your alternative lender charges is higher than what you’re currently paying, it won’t make much sense to take this route.
While refinancing your Nissan car loan is certainly possible, you may need to look outside of NCF. Instead, consider applying for a refinance through a bank, credit union, or alternative online lender.
Refinancing your Nissan car loan basically involves applying for a new car loan with another lender. The new loan will usually come with a lower rate and better terms, and the funds from the new loan will be used to pay off your current Nissan auto loan. These changes can help you lower your monthly car loan payments and reduce the total interest you pay.
Unless you pay for a Nissan vehicle in an all-cash deal, you’ll usually either have to finance or lease your new vehicle. Nissan Canada Finance (NCF) offers both options for those looking to buy a Nissan.
Taking out a car loan means you’ll eventually own the vehicle once you fully repay the loan balance. By financing your Nissan, you’ll build equity in the car with every loan payment you make. And once the loan is fully paid off, you’ll own the vehicle outright.
NCF offers financing options for Canadians with various loan terms and interest rates. You can finance both new and used Nissan cars, as well as non-Nissan cars with NCF. However, used Nissan cars and non-Nissan cars are only available for financing through NCF if they are less than 5 years old and have no more than 125,000 km on it.
NCF also offers lease options for those who prefer to have a new model every few years. Leasing may also come with lower monthly payments than financing because you’re paying only for the car’s depreciation throughout the term, plus interest charges, taxes, and applicable fees. And instead of paying taxes on the full price of the car, you’re only paying taxes on the monthly payment.
Once the lease term is over, you have the option to either trade it in for a new Nissan, return it altogether, or buy your leased vehicle.
There are several ways to reach out to a Nissan Financial representative if you have questions about your finance or lease:
The goal of refinancing is to save money. Before applying for a refinance on your Nissan car loan, follow these guidelines:
Lenders generally place a lot of weight on your credit score, both when you first apply for a car loan and when you refinance. If your credit score has improved quite a bit since you initially applied for your Nissan auto loan, you may be able to qualify for a much lower rate today.
To make sure you’re getting the lowest interest rate and best loan terms when you refinance your car loan, take some time to compare loan offers from different lenders. You can do this quickly and easily with an online auto loan aggregator, which will list various lenders and their loan offers.
If your credit score has not improved enough since you took out your car loan, you may not qualify for a lower rate when you refinance. In this case, adding a co-signer with good credit and a healthy income to the loan contract may help you snag a better rate on a refinance.
A co-signer reduces the risk for the lender. As such, the lender may be more willing to offer you a lower interest rate when you apply to refinance your Nissan auto loan. The co-signer will be responsible for making loan payments if you fail to do so yourself.
In addition to refinancing your car loan, there are other ways to keep your car loan payments low. Nissan offers a few programs to help you save:
Anyone financing or leasing a Nissan vehicle with Nissan Canada Inc., or who currently owns a 2012 Nissan model year or newer may be eligible for the NCF Loyalty Program.
The program offers Loyalty Dollars that can be applied towards the following:
Newcomers to Canada may be eligible for the Nissan Newcomer offer. Those new to Canada may not have any credit needed to qualify for a conventional car loan. With the Nissan Newcomer, eligible applicants can access auto financing while building credit at the same time.
In order to qualify for this program, applicants must be a landed immigrant within 5 years, or a foreign worker or international student residing in Canada for over a year.
Recent graduates from a post-secondary institution may be eligible for up to $1,000 Nissan Graduate Dollars through NCF, as well as low financing and leasing rates.
Qualifying applicants include those who have graduated from a minimum 2-year accredited full-time program with a diploma or degree. Applicants must also have graduated within the past 2 years and have proof of income or employment. If applicants have not yet started working, they must show proof that their job will commence within the next 90 days.
Missing a car loan payment can lead to several repercussions, including the following:
If things have changed in your financial life since you first took out your car loan that makes it more difficult to cover your car loan payments, you have some options to consider:
Depending on your situation, you may be eligible to push your payment out. Skipping a payment can help give you some breathing room if your finances are a little tight. If you believe that you may not be able to keep up with subsequent payments, you’ll need to take further steps.
If you trade your car in for a more affordable model, you may be able to bring down your monthly car payments. Speak with the lender to explain your situation and see what options are available for you to trade in your current model for a cheaper one.
In some cases, you may be able to sell and transfer your auto loan to someone else, who will then take over the loan payments. This individual would have to undergo a credit check through the dealer for approval. After approval is granted, NCF will send the dealer an Assignment and Assumption Agreement for you and the assignee to sign.
If you continue to miss loan payments, you’re at risk of having your vehicle repossessed. If your missed payment is less than 30 days late, you can avoid potential repossession by making up for the payment soon after. But if 3 or more payments are missed, your lender will probably start the process of taking the car back.
If you’re behind on your car loan payments and the lender decides to initiate the process to take back the vehicle, this is known as an ‘involuntary’ repossession. Alternatively, you may consider voluntarily handing in your car if you’re unable to keep up with your loan payments without the lender collecting it from you.
All you need to do is let the lender know that you’re unable to pay off the remaining car loan balance, then arrange a time and place to drop off the vehicle. Once the lender has repossessed the vehicle, they’ll resell it to recoup their losses.
You’ll receive a document called the “Statement of Realization,” which contains information about how much the vehicle was sold for and whether or not you still owe money if the proceeds of the sale aren’t enough to cover what you still owe.
The benefit of voluntarily surrendering your car is that you may be able to avoid repossession costs, such as fees associated with the lender having to hire a repo company to transport the car from your home. You can also avoid having a collection agency come after you.
If you’re looking to slash a few dollars off your Nissan car loan payments, refinancing may be a great option to consider, especially if your credit or financial situation has improved. If you’re able to qualify for a lower rate or extend the loan term, your loan payments may fit in better with your budget. Reach out to your lender to find out if refinancing makes financial sense for you.
Lisa has been working as a personal finance writer for more than a decade, creating unique content that helps to educate Canadian consumers in the realms of real estate, mortgages, investing and financial health. For years, she held her real estate license in Toronto, Ontario before giving it up to pursue writing within this realm and related niches. Lisa is very serious about smart money management and helping others do the same.
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