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Shopping for an auto loan is a crucial step in the car-buying process that can save you money and secure better financing terms. But to find the best financing options, it’s important to know how to shop for a car loan.

Car loan shopping requires some preparation and an investment of time. But fortunately, it’s relatively easy to shop for car loans and even apply for auto loan financing online.

Read on for nine tips that can make finding a loan to buy your car easier.

1. Set a Budget

Before you get started shopping for auto loans, it’s important to know how much you can afford to pay for a vehicle. There are several things to factor into the equation, including:

•  Your target purchase price

•  How much you plan to offer as a down payment

•  Additional costs that may be due at signing, such as taxes, title fees, and dealer fees

•  Ongoing car insurance costs

•  Annual vehicle registration fees

•  Ongoing maintenance and repairs

If you have a vehicle you plan to trade in, you’ll also want to consider how that might affect the amount you’ll finance. The more trade-in value you can get for your current vehicle and the larger your down payment, the less you may have to finance. Getting a used car is another tip for saving money on a car.

If you drive a premium vehicle, luxury car maintenance costs can be particularly high. The average 10-year maintenance cost for a luxury car is over $10,000, according to an analysis of data on CarEdge.com, an automotive research and vehicle listings marketplace.

2. Check Your Credit Score

If you apply for vehicle financing, potential lenders will check your credit report and scores as part of the approval process. Your credit scores can also influence the interest rate and annual percentage rate (APR) you’ll pay on an auto loan.

That’s why, before you start shopping for a car loan, it’s important to understand how you might look to a potential lender based on your credit history. Reviewing your credit reports and credit scores can provide you with some perspective on what kind of loan terms you’re likely to qualify for.

As you review your credit reports, look for the following:

•  Positive items that might help your credit score, such as a solid payment history

•  Negative items that might hurt your credit score, such as payment delinquencies

•  Errors or inaccuracies

If you spot any error or inaccuracy on your credit reports, you can dispute that information with the credit bureau that’s providing it.

Recommended: Which Credit Bureau Is Used Most for Auto Loans?

3. Do You Need a Cosigner?

If your credit history is insufficient or you have a poor credit score because of past financial mistakes, getting a car loan could prove more difficult. In those scenarios, you might consider asking a cosigner to help you get approved for a loan.

A cosigner can be a parent, a sibling, a friend, or another creditworthy person who agrees to apply for auto financing with you. If approved, you and your cosigner are treated equally in terms of responsibility for repaying the loan.

Asking someone to cosign has both pros and cons. On the pro side, a cosigner with an excellent credit score could help you get approved for vehicle financing at the best interest rates. The con, however, is that if you fail to repay the loan, you could ruin your credit and your cosigner’s, as well as your relationship. So it’s important to discuss the benefits and potential downsides with your prospective cosigner before asking for a commitment. As you consider this option, you and your potential cosigner should also learn the details of whether a cosigner can become a primary borrower.

4. Look at Multiple Lenders

Once you’ve checked your credit and have an idea of what loan terms you’re likely to qualify for, the next step is to compare loans from different lenders.

Where to Look for a Car Loan

You have several options for where to shop for auto loan financing:

•  Brick-and-mortar banks or credit unions

•  Online banks and credit unions

•  Online lenders that provide auto financing

•  Dealership financing

Your current bank may be the first place you shop for car loans. If you’ve been a good customer for years or you have multiple accounts, your bank might be willing to offer an interest rate discount or other special incentives for getting a car loan.

But don’t limit your search for a car loan to just your bank. Take some time to compare interest rates and loan terms from online banks and credit unions, as well as online lenders that offer vehicle loans. If you’re buying a vehicle from a dealer, you can also ask about the dealer’s in-house financing terms.

What to Look at When You’re Comparing Car Loans

As you shop for a car loan, take note of the differences in what’s offered by different financing options. Specifically, pay attention to:

•  Interest rates

•  Annual percentage rates (APRs)

•  Loan repayment terms

•  Loan fees, including origination fees and/or prepayment penalties

•  Costs due at closing

It may be helpful to check the reputation of any lender you’re considering as you shop for car loans. Reading online reviews, checking the Consumer Financial Protection Bureau’s Complaint Database and looking at Better Business Bureau ratings can give you an idea of how trustworthy and consumer-friendly an auto lender may be.

On this topic, you might wonder what happens to a car loan when someone dies. The answer is that car loans do not simply disappear when a borrower dies. A surviving spouse may be responsible for paying the debt, or a lender may move to repossess the vehicle.

5. Consider Getting Preapproved or Prequalified

Getting prequalified or preapproved for a car loan could be helpful when you’re narrowing down your financing options. Loan prequalification means that a potential lender has taken a look at your finances and is willing to lend you up to a certain amount of money. Loan preapproval usually involves the added step of a hard credit check.

If you’re interested in prequalification or preapproval, be prepared to share some basic information with your potential lender, including:

•  Your income

•  Your Social Security number (if a credit check is required)

•  Details about the vehicle you want to buy, including purchase price, age, and the make and model

•  Proof of auto insurance or the ability to be insured

•  Your down payment, if applicable

You may also be asked about what kind of loan terms you prefer and how much money you plan to put down.

Having a prequalification or preapproval in hand when you’re car loan shopping can give you a better idea of how much you can afford to spend and how much financing you’re likely eligible for. Bringing a prequalification or preapproval letter to a dealer can also show that you’re serious about buying, which may make the dealer more willing to negotiate the purchase terms.

Recommended: What Is a Balloon Auto Loan?

6. Read the Fine Print

As you shop for a car loan and choose your financing option, don’t neglect reading the fine print. It’s important to know exactly what your obligations are as a borrower and what your total borrowing costs add up to.

When reviewing your auto loan documentation, be on the lookout for things like hidden fees or add-ons that you didn’t request. If you spot anything in the loan contract that you don’t understand, don’t hesitate to ask the lender or financing company to explain it.

Also make sure you review the loan amortization schedule so you understand how much your loan will cost and how your payments will be applied over time. Your lender should provide this amortization schedule, which shows you how long it will take to pay off the loan and how much of each payment will be applied to interest, to fees, and to the principal balance.

7. Consider Overall Cost as Well as Monthly Payments

When you’re shopping for car financing terms, the best way to get an auto loan may require that you consider various cost factors. You may review the total financing cost and the monthly payment of any loan offer. APR can impact the total repayment cost of a car loan, and term length can impact your monthly payment.

Some lenders may offer 144-month auto loans, particularly when financing exotic cars that cost more than $100,000. A longer loan term may give you a lower monthly payment but more interest charges over the life of the loan.

One of the keys on how to shop for auto loan financing is to consider the finance charges. Consumers with good credit may qualify for auto loans with an APR of 0%. Currently, good auto loan interest rates fall under 5-7% for new cars and 7-9% for used cars.

The average interest rate on new car loans in the first quarter of 2025 stood at 6.73%, according to Experian data. To shop auto loans as a consumer, you may compare rates across different lenders. The below table highlights the average total cost of new car loans vs. the average monthly payment in the first quarter of 2025:

8. How Much of a Down Payment Do You Want?

Making a down payment on a car can reduce the amount of money you need to borrow when financing a car purchase. Making a larger down payment on a car may also prevent you from being upside down on your car loan down the line.

A larger down payment can minimize your borrowing costs and monthly payment. A higher down payment can also bolster your equity stake in the car.

One of the down sides to making a larger down payment is it may deplete your savings. Having a sufficient amount of savings can serve as a cushion in the event of an emergency. If you’re looking for loan terms that are right for you and the best way to get an auto loan, you may want to consider how much of a down payment you can afford.

Recommended: Guide to Finance Charges on Car Loans

9. New vs Used Cars

It’s important to consider whether you want to purchase a new car or a used one. New cars offer the latest features, warranties, and lower maintenance costs initially, but they come with a higher price tag and rapid depreciation. Used cars, on the other hand, are more affordable, have already depreciated, and can offer good value if carefully inspected for quality. However, they may have higher maintenance costs and lack the latest technology.

When auto loan shopping, you may shop auto loans for new car financing or used car financing. The average interest rate on a new car loan is usually lower than the average interest rate on a used car loan. A new car loan in the first quarter of 2025 had an interest rate of 6.73%, compared with a rate of 11.87% for used car financing, Experian data show.

Consider your financial situation, how long you plan to keep the car, and whether you prioritize new car benefits or the cost savings of a used vehicle.

Recommended: Guide to Precomputed Interest Car Loans

Financing vs Paying Cash vs Leasing

Reviewing tips on how to shop for auto loan financing does not mean you cannot consider leasing a vehicle or buying a car outright with cash.

Leasing is a form of financing that allows you to operate a car in exchange for paying a monthly rent charge. Car leases typically include lower monthly payments than auto loan financing, but you can still compare lease rates to identify the leasing offer that’s right for you.

The below table compares auto loan financing vs. paying cash for a car vs. leasing:

Recommended: Guide to Writing Off a Car for Business Use

Car Loan Refinancing

If you end up with an auto loan you aren’t satisfied with, you could consider refinancing your vehicle. Refinancing could give you a better interest rate, shorten your loan term, or lower your monthly payment. Shopping around for different offers can be a smart way to tackle the process. As with initial car loans, your credit score will likely play a large role in determining your interest rate.

The Takeaway

As you shop around for a car loan and ask the right questions, you can likely find options that suit your needs.

If you’re seeking auto loan refinancing, SoFi is here to support you. On SoFi’s marketplace, you can shop and compare financing options for your car in minutes.

FAQ

Does auto loan shopping hurt your credit score?

Auto loan shopping can temporarily impact your credit score, but if multiple inquiries are made within a short time frame (usually 14-45 days), they are typically treated as a single inquiry. This minimizes the effect on your credit score while allowing you to shop around for the best rates.

What credit score should you have when car loan shopping?

When shopping for a car loan, a credit score of 660 or higher is typically considered good and may qualify you for favorable interest rates. Scores above 700-780 often secure the best rates, while scores below 660 may lead to higher interest rates or require a larger down payment.

Is it better to get auto loans from dealerships or banks?

Choosing between dealership and bank auto loans depends on your needs. Banks often offer lower interest rates and straightforward terms, while dealerships may provide convenience and special financing deals. However, dealership loans can sometimes include higher rates or hidden fees, so it’s wise to compare offers from both sources.

Photo credit: iStock/Burak Sür

SoFi's marketplace is owned and operated by SoFi Lending Corp.
Advertising Disclosures: The preliminary options presented on this site are from lenders and providers that pay SoFi compensation for marketing their products and services. This affects whether a product or service is presented on this site. SoFi does not include all products and services in the market. All rates, terms, and conditions vary by provider. See SoFi Lending Corp. licensing information below.

Disclaimer: Many factors affect your credit scores and the interest rates you may receive. SoFi is not a Credit Repair Organization as defined under federal or state law, including the Credit Repair Organizations Act. SoFi does not provide “credit repair” services or advice or assistance regarding “rebuilding” or “improving” your credit record, credit history, or credit rating. For details, see the FTC’s website .

Financial Tips & Strategies: The tips provided on this website are of a general nature and do not take into account your specific objectives, financial situation, and needs. You should always consider their appropriateness given your own circumstances.

Third-Party Brand Mentions: No brands, products, or companies mentioned are affiliated with SoFi, nor do they endorse or sponsor this article. Third-party trademarks referenced herein are property of their respective owners.

Third Party Trademarks: Certified Financial Planner Board of Standards Center for Financial Planning, Inc. owns and licenses the certification marks CFP®, CERTIFIED FINANCIAL PLANNER®

SOALR-Q325-104

When you take out an auto loan, you receive money to purchase a car, and you make regular monthly payments until the loan is paid off. These regular payments make auto loans a type of installment loan.

Keep reading to learn more on what type of credit auto loans are, including whether they’re secured or unsecured loans, how it may affect your credit score, and more.

How Does Installment Credit Work?

A car loan is considered an installment loan. When you take out an installment loan, you borrow a lump sum of money to buy a car. You repay what you borrowed on a regular schedule over a fixed period of time.

In addition to paying back the loan principal (the amount you borrowed), you’ll also pay interest. Your lender will divide the principal and interest payments over the number of repayment periods (60 months, say) through a process known as amortization. The size of your monthly payments will depend on how much you borrow, what your interest rate is, and your loan term or length.

As you pay back the installment loan for your car, each payment will first go toward paying off interest, and then to paying down your loan principal. Over time, as you continue to pay the loan, the principal balance will shrink and so, too, will the percentage of each payment that goes to interest.

Are Auto Loans Secured or Unsecured Credit?

Although there are different types of auto loans, in general, auto loans are secured credit because your vehicle acts as collateral for the loan. If you fail to repay the loan, the lender can seize your vehicle to help recoup their money.

Not all installment loans are secured. Personal loans, for example, tend to be unsecured and require no collateral. However, unsecured loans are riskier for lenders. Because of this, unsecured loans often come with higher interest rates.

Recommended: Smarter Ways to Get a Car Loan

Auto Loans and Your Credit Score

Your credit score represents your credit history and how responsible you’ve been with managing your debt in the past. An auto loan is a type of credit that can have an effect on your score. Here’s a look at how car loans impact your credit score.

Can an Auto Loan Build Your Credit Score?

An auto loan could strengthen your credit score, provided that you consistently make your car payments on time. The largest component of your credit score is your payment history. In fact, payment history makes up 35% of your FICO® Score, which is the most common credit scoring methodology.

If you miss payments for your auto loan or your payments are late, your credit score will typically take a hit.

Auto loans can affect your credit in other ways, as well. For example, lenders like to see that you’re good at managing different kinds of debts, including credit cards and installment loans. This is known as your credit mix, and it makes up 10% of your FICO Score. Taking out an auto loan could add to your credit mix.

Don’t be surprised if your credit score initially drops a few points when you sign up for an auto loan. This is likely the result of the hard credit inquiry (or credit check) that’s required when you apply for the loan. The new loan will also increase your debt load, which might have a slightly negative effect on your score. These effects should be temporary, though, once you make your first few car payments on time.

Recommended: What Is a Deficiency Balance on an Auto Loan?

What Credit Score Do You Need for a Car Loan?

The credit score requirements for auto loans typically depend on the lender you’re using. Banks and credit unions tend to offer loans to borrowers with higher credit scores in the 601 to 850 range.

Captive finance companies, which are companies that are affiliated with car manufacturers, may offer loans to those with lower scores. Borrowers will typically need a credit score of 501 to 850.

Car dealerships and independent finance companies may also offer loans to borrowers with poor credit scores. Keep in mind, though, that those with higher scores will typically receive better interest rates.

The car loan interest rate a lender will offer you is largely determined by your credit score. Borrowers with the highest scores are typically given the lowest rates. Borrowers with lower scores are seen as riskier by lenders and are offered higher interest rates, which increases the overall cost of borrowing.

If you can’t find a reasonable interest rate, work on building your credit score. Pay bills on time, pay down your debt, and correct any mistakes on your credit report. You can receive a free credit report from the major credit bureaus — TransUnion®, Equifax®, and Experian® — or from AnnualCreditReport.com. Report any mistakes you find to the credit bureaus immediately.

Recommended: What Is a Car Title?

Refinancing Can Help Lower Rates

If you have an auto loan with a high interest rate, you may want to consider auto refinancing. This allows you to pay off your old loan with a new loan, ideally at a lower interest rate and better terms.

You might want to refinance a car loan when interest rates drop or when your credit score has strengthened. It might also make sense to refinance to a loan with a lower interest rate early on, when more of your installment payments are going to interest. Later, when more of your payment is going toward paying down principal, refinancing may not offer as much potential savings.

Recommended: Pros and Cons of Car Refinancing

The Takeaway

Auto loans are a type of installment loan that you pay back with regular monthly payments, including interest. The size of your payment will depend on the size of the loan you’re taking out, the interest rate, and the length of the loan. Your credit score can affect the interest rate you get.

Down the line, refinancing could help adjust your payment by lowering your interest rate or offering you a better loan term.

If you’re seeking auto loan refinancing, SoFi is here to support you. On SoFi’s marketplace, you can shop and compare financing options for your car in minutes.

FAQ

What type of credit is an auto loan?

An auto loan is a type of installment credit, where a lender provides a fixed amount of money to purchase a vehicle. The borrower repays the loan in regular, scheduled payments over a set period, typically including interest. This credit type is secured by the vehicle, meaning the lender can repossess it if payments are not made.

Is an auto loan secured or unsecured?

An auto loan is usually a secured loan because the car acts as collateral for the loan. It is possible to buy a car with an unsecured loan, but because these loans are riskier for lenders, you may get a higher interest rate. You might also need a higher credit score in order to qualify for an unsecured loan.

Is an auto loan variable or fixed?

Auto loans are typically offered with fixed interest rates, ensuring consistent monthly payments over the loan term. Variable‐rate auto loans are less common but do exist, often tied to an index like the prime rate, which means your monthly payment can fluctuate as rates change.

Photo credit: iStock/Jinda Noipho

SoFi's marketplace is owned and operated by SoFi Lending Corp.
Advertising Disclosures: The preliminary options presented on this site are from lenders and providers that pay SoFi compensation for marketing their products and services. This affects whether a product or service is presented on this site. SoFi does not include all products and services in the market. All rates, terms, and conditions vary by provider. See SoFi Lending Corp. licensing information below.

Financial Tips & Strategies: The tips provided on this website are of a general nature and do not take into account your specific objectives, financial situation, and needs. You should always consider their appropriateness given your own circumstances.

Third-Party Brand Mentions: No brands, products, or companies mentioned are affiliated with SoFi, nor do they endorse or sponsor this article. Third-party trademarks referenced herein are property of their respective owners.

SOALR-Q325-103

Your car’s title is the proof that you legally own the car, and it’s usually required to sell your car or refinance your auto loan. If you have lost your car title, you may not be able to sell your car or get a new loan. Fortunately, there are ways to get a replacement car title, and the process is relatively pain-free.

Your car title is usually issued by your state’s department of motor vehicles or department of transportation when you first purchase your vehicle. You can get a replacement or duplicate title from the same agency. While the process varies from state to state, it will generally involve filling out a form, providing documentation of ownership, and paying a fee.

Read on to find out how to get a title for a car if it’s lost.

What Is a Car Title?

A car title is a legal document showing who owns the vehicle. The car’s title also has identifying information about the car itself, which generally includes:

•   Make

•   Model

•   Year

•   Owner’s name and contact information

•   Vehicle Identification Number (VIN)

•   Odometer reading at the time the title was issued

•   Information about the most recent car sale, including the name, address, and contact information for both the buyer and seller

Why Do You Need a Car Title?

Your car’s title document is the legal proof that you are the true owner of the car. Without the title, you will be limited in what you can do. One of the vehicle loan requirements is that you must show that you’re the owner of the car in question, usually by producing the title document.

An important thing to note is that most states are considered “title-holding” states. In these states, if you have a loan on your car, your lender will hold the title until the loan is fully paid off.

So if you live in a title-holding state, have a loan on your car, and can’t find your car title — don’t worry! Your lender has your car title and will send it to you when your loan has been paid off.

Recommended: How Soon Can You Refinance a Car Loan After Purchase?

Cost to Replace a Lost Car Title

While it’s generally a fairly straightforward process to replace a car title, it’s not always cheap to do so. The cost to replace a lost car title varies by state and can typically be anywhere from $10-$75.

For example, here are the replacement car title fees in a few states:

•   California — $27

•   Minnesota — $22.50

•   Ohio — $15

•   Pennsylvania — $72

You may also incur some costs in making sure that you have all of the necessary documentation to replace your car’s lost title.

Where to Get a Copy of Your Car Title

Depending on where you live, your state may have different names for the governmental organization that handles vehicle titles and registration. It will often be called something like the Department of Motor Vehicles (DMV), Bureau of Motor Vehicles (BMV), or Department of Transportation. That’s where to get a copy of your car title.

You can look on your state’s website to determine exactly what forms you will need to fill out, what documentation you’ll need, how much the car title replacement will cost, and whether you can file online or will need to go to a title office in person.

Documents Required for a Replacement Car Title

Because each state’s process is different, the exact documents that you’ll need for a replacement car title can vary. It’s a good idea to check directly with your state’s Bureau of Motor Vehicles or Department of Transportation to make sure you know what documents you’ll need. Here are a few basic guidelines:

Proof of Identification

The exact forms of identification will vary by state, but generally speaking, you’ll need to show identification as well as proof of ownership of the vehicle. This could include your driver’s license, information about the car itself, and a signed and notarized statement that you are the rightful owner.

Explanation for Duplicate Request

Depending on the state, you may have to explain why you are applying for a duplicate car title. You may also have to have your duplicate request form notarized, affirming under penalty of perjury that you are the legal owner of the vehicle in question.

Challenges of Losing Your Car Title

One of the challenges of losing your car title is that it can make things complicated if you want to sell your car or get a new car loan. Because the title document is what shows who legally owns the car, you will generally need to have it in hand before selling your car. It’s also important to understand whether you have a title loan or car loan before selling your vehicle or getting a new loan.

Recommended: Can Someone Take Over My Car Loan?

Can You Refinance a Car Loan if You Lost Your Car Title?

If you are looking at refinancing a car, you may have a difficult time if you have lost your car title and if you live in a non-title-holding state. If you live in a title-holding state (which is the majority of the United States), then your lender will still have your car title. In most cases when you are refinancing a car loan, your new lender will handle the entire process, meaning you won’t have to worry about doing anything with the car title. The same is to be true if you’re considering a refinance car title loan.

The Takeaway

A car title is a legal document with information about the vehicle itself as well as who owns the car. Without the car title, you may not be able to refinance or sell your car. Fortunately, it is fairly straightforward to get a duplicate car title through your state’s Bureau of Motor Vehicles or Department of Transportation. While the process varies by state, generally, you will need to fill out a form, provide documentation, and pay the titling fees.

If you live in a title-holding state (which is the majority of the United States), your lender will hold your car title until the loan is paid off.

If you’re seeking auto loan refinancing, SoFi is here to support you. On SoFi’s marketplace, you can shop and compare financing options for your car in minutes.

FAQ

What happens if you lose your car title?

If you lose your car title, you may not be able to get a title loan or car loan. You also may not be able to sell your car. If you have lost your car title, your best bet is to contact your state’s Department of Motor Vehicles (or similarly named office). They can direct you on how to get a replacement or duplicate car title.

Can you refinance your vehicle if you lose your car title?

If you are looking to refinance, you may not be able to complete the transaction without a car title. Keep in mind, however, that if you live in a title-holding state, your lender may have your car title until your loan is paid off. If that’s the case, your new lender will generally handle the entire process of re-titling the car as part of the refinance.

Where can I get a copy of my car title?

Most states will not issue a certified copy of a car title, since whoever has the car’s physical title document is considered the car’s rightful owner. However, most states will issue a duplicate or replacement car title. The process varies by state, so contact your state’s Department of Motor Vehicles to find out what you need to do.

Photo credit: iStock/Dima Berlin

SoFi's marketplace is owned and operated by SoFi Lending Corp.
Advertising Disclosures: The preliminary options presented on this site are from lenders and providers that pay SoFi compensation for marketing their products and services. This affects whether a product or service is presented on this site. SoFi does not include all products and services in the market. All rates, terms, and conditions vary by provider. See SoFi Lending Corp. licensing information below.

Disclaimer: Many factors affect your credit scores and the interest rates you may receive. SoFi is not a Credit Repair Organization as defined under federal or state law, including the Credit Repair Organizations Act. SoFi does not provide “credit repair” services or advice or assistance regarding “rebuilding” or “improving” your credit record, credit history, or credit rating. For details, see the FTC’s website .

Financial Tips & Strategies: The tips provided on this website are of a general nature and do not take into account your specific objectives, financial situation, and needs. You should always consider their appropriateness given your own circumstances.

SOALR-Q325-102

Shock absorbers and strut assemblies, called shocks and struts, are essential to a car’s suspension. Because shocks and struts are in constant use whenever you drive, they may wear out quickly. Replacing your shocks and struts can be expensive, but it’s important for the safety and handling of your car.

Read on to learn more about the cost of replacing shocks and struts.

Shocks and Struts Replacement Costs: What’s Included

Part of responsible car ownership is keeping your car well maintained, including key components such as the struts and shocks. When you replace shocks and struts, you’ll pay for labor, parts, and getting the wheels aligned. A typical shock and strut replacement can cost between $500 and $2,500 or more, with prices rising for luxury car maintenance. The price will vary depending on the type of vehicle suspension you have, the parts needed, and where you live.

But that’s the cost for just one pair of wheels. It’s recommended to replace your shocks and struts in pairs, and to replace all four at the same time, if possible. The total shocks and struts replacement cost would be about $1,000 to $5,000 for all four.

Here’s how the cost to replace shocks and struts breaks down:

Cost of Labor

The cost of labor for replacing a shock and strut assembly can range from $100 and $300 per assembly. The labor cost may vary depending where the work is done. For instance, car dealerships might charge more for labor than auto repair shops.

Cost of Parts

Purchasing the parts is one of the major expenses involved in the struts and shocks replacement cost. A replacement can cost between $80-$250 per pair of shocks and $300-$760 per pair of struts. You’ll need to multiply this number by two, depending how many shocks and struts you’re replacing.

You might be able to save some money by purchasing an aftermarket shocks and struts replacement online. These parts are usually the same as the factory-issued parts, but they’re less expensive. You could also get replacement parts from an auto repair shop. This will be more expensive than buying the parts online, but cheaper than getting them from a dealership.

If you don’t have the cash on hand to pay for the replacement parts, a car repair personal loan could be an option to help cover the shocks and struts replacement cost. Or you might look into a car loan refinance that helps you get some cash out of your equity.

Recommended: Which Credit Bureau Is Used Most for Car Loans?

Wheel Alignment Cost

When you install new shocks and struts, it can alter your vehicle’s alignment. If the alignment is off, that can create uneven wear and tear on the tires. That’s why mechanics usually recommend a wheel alignment after a strut or shock replacement. Supplies for a wheel alignment are around $20, and labor costs are about $130 to $180.

Recommended: Suspension Repair and Replacement Guide

Are Shocks and Struts the Same?

Although shocks and struts are similar, they aren’t the same. Struts are a major structural part of a vehicle’s suspension, and they perform more functions that shocks do. Here are some of the similarities and differences between shocks and struts.

Recommended: How Much Does a Timing Chain Replacement Cost?

Can I Replace Just the Shocks or Struts?

It’s possible to replace just the shocks or struts if your car has struts in the front and shocks in the rear. However, your car won’t perform as well or ride as smoothly if you’re driving with a mix of old and new shocks and struts. Replacing struts and shocks as needed can keep your vehicle in good working order, which might help increase the car’s value.

As mentioned, it’s best to replace shocks and struts in pairs. Ideally, you should replace all four struts and shocks at the same time, if possible.

Recommended: How Much Does it Cost to Replace Airbags?

When Should I Replace the Struts on My Car?

Struts usually last between 50,000 and 100,000 miles. But driving conditions can affect their lifespan. If you have an extended warranty for your car, check to see if the shocks and struts replacement cost is covered.

Signs of Failing Shocks and Struts

You can do a road test to determine whether your struts and shocks need to be replaced. As you’re driving, stay alert for any of the following conditions, which could be a sign of failing shocks and struts. If your car has any of these issues, see a mechanic right away.

Thumping, Rattling or Knocking Sounds

A thumping, rattling, knocking, or vibration of the steering wheel, even when the road you’re driving on is smooth, could be a sign of failing struts or shocks.

A Bumpier Ride Than Usual

A rough ride is another red flag. The car may even rock from side to side when the wind is blowing.

The Car Dips When Braking or Accelerating Hard

If the front of your car dips down or swerves when you brake, your shocks or struts may be going.

You Notice Your Car Rolls During Turns

The car feels like it’s tilting when you drive. Or it may pull or roll to one side when you turn the steering wheel.

Your Tires Have a “Cupped” Wear Pattern

Uneven wear on tires is another sign of faulty struts or shocks. For instance, you may notice a “cupped” or scalloped treadwear pattern on the tires.

Hydraulic Fluid Is Leaking

If you see leaking hydraulic fluid, have your car checked by a mechanic as soon as possible. This could indicate a problem with your shocks or struts, or another issue that needs to be repaired.

Recommended: Alternator Repair and Replacement Costs

The Takeaway

Shocks and struts are vital to the performance and safety of your car. Worn shocks and struts can reduce the vehicle’s handling and braking and create wear and tear on your tires. If you notice signs that your shocks and struts are failing, see a mechanic about getting them replaced as soon as possible.

And if you need help covering the struts and shocks replacement costs, you might want to explore auto loan refinancing to see if it’s an option for you.

If you’re seeking auto loan refinancing, SoFi is here to support you. On SoFi’s marketplace, you can shop and compare financing options for your car in minutes.

FAQ

Is it worth replacing shocks and struts?

It’s important to replace shocks and struts if they start to fail. Shocks and struts are vital to the proper handling, braking, and safety of your car.

What happens if you don’t replace faulty struts?

Worn shocks and struts can reduce a car’s handling and braking performance, and can compromise the life of the tires and the vehicle’s safety.

Should you replace all four struts at once?

Yes, it’s recommended to replace all four struts and shocks at the same time to keep your car handling smoothly.

How long do shocks and struts last?

Struts usually last between 50,000 and 100,000 miles. But the conditions you drive in may affect their lifespan. If you see any signs the shocks and struts may be failing, it’s wise to make an appointment with a mechanic.

Can I drive with bad shocks or struts?

It’s not advisable to drive with bad shocks or struts. The vehicle’s handling may be compromised, and continuing to drive with bad shocks or struts can be dangerous.

Photo credit: iStock/Shutter2U

SoFi's marketplace is owned and operated by SoFi Lending Corp.
Advertising Disclosures: The preliminary options presented on this site are from lenders and providers that pay SoFi compensation for marketing their products and services. This affects whether a product or service is presented on this site. SoFi does not include all products and services in the market. All rates, terms, and conditions vary by provider. See SoFi Lending Corp. licensing information below.

Disclaimer: Many factors affect your credit scores and the interest rates you may receive. SoFi is not a Credit Repair Organization as defined under federal or state law, including the Credit Repair Organizations Act. SoFi does not provide “credit repair” services or advice or assistance regarding “rebuilding” or “improving” your credit record, credit history, or credit rating. For details, see the FTC’s website .

Financial Tips & Strategies: The tips provided on this website are of a general nature and do not take into account your specific objectives, financial situation, and needs. You should always consider their appropriateness given your own circumstances.

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Consider that the average U.S. monthly auto payment for a new vehicle is now $756 and for a used one is $559 as of mid-2025, according to data from Edmunds. And some car buyers are opting for 84-month loans as opposed to the more traditional 60-month loan terms.

Seven years is a long time to be spending $756 per month.

Avoiding having to make regular car payments, however, isn’t easy. Even reducing the amount is tough. Often, it comes down to either trading in your current car for a more budget-friendly car payment or refinancing your vehicle at a lower interest rate, which could lower the amount of your monthly payments if you also choose to extend the term. Keep in mind, though, that extending the loan term could make it so you pay more money in interest over the life of the loan.

What’s a better option for you? Here’s intel on whether a trade-in or a refinancing deal can be the right move.

Refinancing an Auto Loan vs. Trading in Your Car

If you’re finding that your car payments are too high, you might be looking for ways to reduce them. Among your options are refinancing your car loan or trading in your car for a cheaper one (which can also involve refinancing your loan). Both strategies can help you reach your goal of shelling out less every month. But each one has its unique features, and it’s worth understanding them both before you make a decision.

This table can help explain some of the differences and similarities:

What It Means to Refinance a Car

Refinancing an auto loan means getting a new car loan that replaces your old one, ideally at a lower interest rate.

The new loan pays off the old loan in its entirety. It also offers you new payment and interest rate terms that could result in lower monthly auto loan payments, thus potentially freeing up money for other household financial uses and obligations.

You might consider when to refinance a car loan if you have built your credit score (which might lead to better deals on loan interest rates) or if your original auto loan deal came with a high interest rate and rates have since dropped. You may even refinance to a longer loan term to reduce your monthly payments, though that likely means you will have to pay more in interest over the life of the loan.

Recommended: Which Credit Bureau Is Used Most for Auto Loans?

Pros and Cons of Refinancing an Auto Loan

Like any consumer loan, an auto refinancing deal has its upsides and downsides.

Pros of Auto Refinancing

Naturally, there are many potential benefits of refinancing a car:

•  May be easy to get. Banks and lenders are usually amenable to refinancing your auto loan. As long as your credit score is stable, most auto loan financing companies will be open to redoing your car loan. This can also be a con, however, if you start chasing interest rates and don’t pay attention to loan fees and terms. It’s wise to compare interest rates at your own financial institution (after all, it knows you best) and online with an auto loan aggregator that can tailor a loan package to your financial needs.

•  Can lower your interest rate. A lower interest rate can save you money. Saving money is the name of the game with auto refinancing and that game starts with a lower interest rate on a refi auto loan than the one on your original auto loan deal. In general, if interest rates are lower than they were when the car was originally purchased or if your credit has been positively impacted since you signed off on the first loan, chances are good that you can earn a lower interest rate by refinancing.

•  Can stretch out auto loan payments. By refinancing, you can also change the repayment terms and timetable of your original loan. Say, for example, your original loan stands at 36 months. By refinancing into a 60-month, 84-month, or even 144-month loan repayment, you should be able to cut your monthly payments down to size. Just bear in mind that this will likely mean that you pay more in total interest over the life of the loan.

Cons of Auto Refinancing

There are also potential disadvantages that can come with refinancing your car loan:

•  Longer loan terms can cost you. If you do refinance into a new auto loan with a longer repayment timetable, you’re running the risk of adding to the total cost of the vehicle. That’s because the total repayment for a shorter loan (say, 36 months) is less expensive than the total for a long loan (say, 72 months) because the total loan is paid down more quickly, meaning total interest costs are lower on a shorter loan.

•  Depreciation may cost you. Auto lenders may not want to lend you money for a car that’s not worth the cost of the loan. Unfortunately, vehicles — even brand-new ones — depreciate rapidly. If you purchased a car with low or no down payment, or if the vehicle has aged and lost much of its value, it could be an uphill climb getting a new auto refinancing loan.

•  Your old loan may cause problems. It’s much more difficult to refinance an auto loan if you’ve missed payments on your original loan (that makes you a high credit risk in the eyes of lenders). And you may be less willing to refinance if your original auto loan has a prepayment penalty (which can add to the total cost of refinancing into a new loan). Check the fine print on your old loan and make sure you’re caught up on payments before applying for a new auto refinancing loan.

Recommended: Is an Auto Loan Secured or Unsecured?

What It Means to Trade in a Car

Trading in your car means switching out an old vehicle for a new one.

Auto consumers trade in their cars for myriad reasons. Most relevant here, they may use their trade-in vehicle as a financial asset to curb the price of a new car purchase.

In this scenario, the value of your current car matters to the auto dealer. If you owe less money on the vehicle than an auto dealer is willing to offer you as a trade-in, that dealer may likely take the cash overage on your trade-in amount and apply it to your new vehicle purchase. One note of caution: If you owe more on your old car than its estimated value, you likely won’t succeed in getting a good trade-in deal. Or you may need to pay off the difference in cash or have it tacked onto your new loan.

Auto consumers may also trade in their vehicles because they can’t afford the payments any longer but still need a vehicle. In that scenario, trading in a more expensive vehicle for a less expensive one can take the financial pressure off a car owner, while still giving them a vehicle to drive.

Recommended: Should You Pay Off Your Car Before Trading It In?

Pros and Cons of Trading in a Car

Just as with refinancing, there are several pros and cons involved in a vehicle trade-in, too. That is especially true if you’re doing so to save on auto payments.

Pros of Auto Trade-Ins

There are many potential benefits to trading in a car:

•  Can be fast. You can close on a trade-in in just one day. Simply drive to the dealer lot or use an online platform like Carvana, CarMax, or AutoNation, get an offer on the trade-in, and close the deal. Remember, auto dealers are in the business of getting you into a new vehicle and a trade-in is a perfectly appropriate way to do that. Dealers are also adept at selling your old car at top value, so the financial incentive for cutting a deal with an auto dealer is fairly high. That’s all in your favor when you’re trading in a vehicle.

•  You get a second bite of the “new car” apple. When you trade in your old car, you have another chance to get a car with the features you want, such as four-wheel drive, more trunk room, or better gas mileage. While it’s true that your trade-in vehicle was probably worth more than the new vehicle you’re getting, there’s no reason your new set of wheels can’t have features you like, but that you weren’t getting in your old car — within reason.

•  A fresh start on a new loan. When you trade in a newer car for a less expensive one, chances are you’re going to wind up with a lower auto loan payment — and that may be the biggest “pro” of all. Whether you’re just stretched for cash or you’ve suffered a negative life event, like job loss or expensive divorce, a new auto loan that’s less expensive can help you get a fresh start financially and provide you with a decent car to drive.

Cons of Auto Trade-Ins

Naturally, there are potential negatives, too:

•  You can’t expect a boatload of cash. Auto trade-in consumers should be realistic about the value they’ll get on a trade-in deal. Auto dealers usually don’t like to pay full price in the first place. Plus, the dealer has to ensure that the trade-in vehicle will pass inspection, detail the vehicle thoroughly, and get it ready for resale. Consequently, it’s a good idea to expect to get a decent value for a car that’s in good condition, but don’t expect to win the lottery. One rule of thumb: Expect to get, say, 10-15% lower than the vehicle’s estimated value on a trade-in — even for a car that’s in good shape and ready to sell.

•  There may be fees. Vehicle trade-in deals can come with hefty fees, including documentation fees, vehicle registration fee, and sales tax, among other expenditures. In general, any additional fees that come with a new vehicle purchase should be added to your trade-in budget.

•  Potential scams. Not all auto dealers hold themselves to high ethical standards. In some situations, a dealer may try to “bait and switch” you into a different car that doesn’t meet your driving and financial needs. Or, the dealer may threaten to back out of accepting your trade-in vehicle if you don’t agree to strict terms on a new vehicle. Be patient, read all the contract paperwork the dealer is obligated to provide (or have a trusted attorney or auto financing expert do it for you), and be prepared to back out of a deal at the sign of any unagreed-upon financial risk. That may represent a hassle in the short term, but pulling back from a lousy deal can pay big dividends in the long run.

Which Is Better for You – an Auto Refinancing Deal or a Trade-In?

Deciding between a refinancing opportunity or a trade-in depends on the deal you’re getting and whether or not that deal represents your best financial move and your best vehicle-ownership move.

In general, getting a lower rate on a refinancing deal can save you hundreds or (depending on the rate and the loan) even thousands of dollars. If your car is reliable and meets your needs, this may make sense for you.

However, trading in a vehicle that’s too expensive to own and maintain for a lower-priced vehicle that’s still dependable on the open road can save you money and provide the safety you require when getting behind the wheel. Or, if you really just can’t afford the car you have anymore, then trading it in may be the right choice for you.

The ultimate decision is up to you, so use the information above to make your auto ownership experience the best one possible for now and for down the road.

Recommended: What Are the Steps for Refinancing a Motorcycle?

The Takeaway

When you’re looking to lower your monthly car loan payments, you have choices. You can choose to trade in your current car for a less expensive one or refinance your current auto loan to lower your monthly payment (if possible). Keep in mind that you may have to extend your loan term in order to lower your monthly payment, meaning you’ll pay more in interest overall.

If you’re seeking auto loan refinancing, SoFi is here to support you. On SoFi’s marketplace, you can shop and compare financing options for your car in minutes.

FAQ

What is a car loan refinance?

A car loan refinance is when you take out a new car loan to pay off your old car loan. Typically, you would do this if you can get a better interest rate or loan term on the new loan and if you can lower your monthly loan payments.

What is a trade-in?

A trade-in is when you give a car dealer your old car as part of the payment for another car you want. This will likely be just part of the financing package, which will probably involve another loan, too. Typically, you might do this when your current car is too expensive for you or you need to reduce the size of your monthly payments.

Is it better to refinance a car or trade it in?

This is an individual assessment, but if you like your car and simply want to take advantage of lower prevailing interest rates or an improvement in your credit score since you originally financed your car, you might want to consider refinancing your car. If your car is too expensive for you or you don’t like it and you would be happy with a less expensive car, trading in your car might be a good choice for you.

How do you trade in a car you still owe money on?

Typically you can trade in a car you still owe money on. If the car is worth more than the amount you still owe, typically the difference will be applied toward reducing the size of your new loan. It can be trickier if your car is worth less than you still owe (i.e., the loan is underwater). In this case, you will have to pay off the difference or roll it over into your new loan, which may not be financially prudent.

Photo credit: iStock/andreswd

SoFi's marketplace is owned and operated by SoFi Lending Corp.
Advertising Disclosures: The preliminary options presented on this site are from lenders and providers that pay SoFi compensation for marketing their products and services. This affects whether a product or service is presented on this site. SoFi does not include all products and services in the market. All rates, terms, and conditions vary by provider. See SoFi Lending Corp. licensing information below.

Disclaimer: Many factors affect your credit scores and the interest rates you may receive. SoFi is not a Credit Repair Organization as defined under federal or state law, including the Credit Repair Organizations Act. SoFi does not provide “credit repair” services or advice or assistance regarding “rebuilding” or “improving” your credit record, credit history, or credit rating. For details, see the FTC’s website .

Financial Tips & Strategies: The tips provided on this website are of a general nature and do not take into account your specific objectives, financial situation, and needs. You should always consider their appropriateness given your own circumstances.

Third-Party Brand Mentions: No brands, products, or companies mentioned are affiliated with SoFi, nor do they endorse or sponsor this article. Third-party trademarks referenced herein are property of their respective owners.

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