Auto-Loan Refinance / 'Lower Your Payment' Scam
A caller or mailer promises to slash your car payment through refinancing but requires upfront fees or your account details, delivering nothing or a worse loan.
Think a message like this reached you? You can check it right now.
What this scam is
You're offered a chance to refinance your auto loan for a much lower payment, but must pay an upfront 'processing' or 'guarantee' fee, or hand over your loan and bank details, sometimes to a 'lender' that isn't real. They take the fee, do nothing, or enroll you in a worse deal, and may misuse your data. Legitimate refinancing doesn't require upfront fees paid by gift card or to a cold caller. Verifying lenders and dealing directly with reputable institutions protect you.
What it usually looks like
- An unsolicited offer to lower your car payment via refi.
- Upfront processing/guarantee fees.
- Requests for loan and bank details.
- An unverifiable 'lender.'
Common warning signs
- Upfront fees to refinance.
- Guaranteed approval/lower payment claims.
- Cold callers/mailers with your loan info.
- Requests for account details.
Example wording scammers use
“Cut your car payment in half — just pay the $199 processing fee to lock in your new rate.”
“You're pre-approved to refinance; confirm your loan and bank details to proceed.”
These are illustrative examples written by ScamSplain, not real messages.
What the scammers want
- Upfront fees and your account details.
- To exploit desire for lower payments.
- Your personal/financial data.
What to do
- Never pay upfront fees to refinance a loan.
- Deal directly with reputable, verifiable lenders/your bank.
- Distrust guaranteed approvals and cold offers.
- Verify any lender's licensing.
What to do if you already responded
- Contact your card/bank; watch for identity misuse.
- Report to the CFPB and reportfraud.ftc.gov.
- Verify your real loan status with your servicer.