If you are looking for a lower interest rate, you might consider a timeshare loan refinance. Finding the right lender can take some effort, and not everyone is eligible.
Refinance of timeshares is not easy. However, if you are willing to do some research, it could be worth the effort.
How can I refinance my timeshare?
You can finance your timeshare purchase through the developer. Developer financing is convenient but not the most cost-effective.
The term length is one difference between a timeshare loan or a home mortgage. Gamel states that timeshare loans are generally for seven years. You’ll typically see higher interest rates with shorter terms than home mortgages.
Gamel states that interest rates can vary quite a lot. Rates can vary depending on your credit score.
You might consider loan options if you cannot afford high-interest rates. Locking in low rates may make it easier to manage your monthly payments. The higher your credit score, the more likely you will be eligible for lower interest rates and greater repayment flexibility.
However, keep in mind that refinancing can extend the term of your Loan. This could lead to you paying more over the Loan’s life.
How can I find timeshare refinancing information?
If you want to lower your double-digit annual percentage rates, timeshare refinance might be an option. These are just a few options to think about.
Unsecured Personal Loan
Gamel states that those looking to refinance through third parties may be interested in an unsecured personal loan.
The three online lenders offer unsecured personal loans without collateral for timeshares.
- LightStream — offers competitive rates for borrowers with excellent credit and no fees.
- Best egg allows you to prequalify by a soft credit check.
- Start If your credit score is not great, you might want to consider Start, which considers more than just your credit score.
Lenders may examine your credit score, income, and debt-to-income ratio to determine if you are eligible for an unsecured personal loan. A few factors can make it easier for you to get a timeshare to refinance a mortgage.
Not all lenders will approve a timeshare loan. You will need to look at other options if you cannot find one that suits your needs.
Home Equity Loan or Home Equity Line of Credit
You may be able to refinance with a secured loan if you aren’t eligible for an unsecured personal loan. This requires collateral. You can get a secured loan by applying for a home equity loan, home equity line credit, or HELOC.
Gamel says, “It’s a popular method to refinance with no refinancing.”
He said that timeshare owners tend to own a primary residence and can tap their home equity. Your home can be used as collateral to get a lower interest rate than an unsecured loan. Refinancing with your home equity can be risky as you may lose your home or timeshare if the payments are not made on time.
What is a timeshare refinance?
Refinance a loan means you can apply for a loan with a lower interest rate. Once you are approved, the Loan can be used to repay your existing one. You might also be able to benefit from lower monthly payments.
However, there are some differences between a timeshare refinance and a mortgage. An appraisal is required to determine the fair market value of your home when you are refinancing your mortgage. The bank will not be able to repossess your home if you fail to pay your mortgage payments. This makes it less risky. However, timeshares might not be as popular, and lenders might be less inclined to refinance timeshare loans.