Melinda Zabritski, Experian’s head of automotive financial insights, said consumers are looking for ways to secure more favorable vehicle financing terms, especially with interest rates leveling out and perhaps a cut coming next week from the Federal Reserve.

The base for Zabritski’s assertion came via Experian’s State of the Automotive Finance Market Report: Q2 2025, which highlighted the volume of auto refinancing increased nearly 70% from a year ago.

A closer analysis revealed consumers saved just over 2% on their interest rates after refinancing their vehicle in Q2, with the average interest rate dropping from 10.45% to 8.45%. This reduced the average monthly payment by $71 for borrowers who refinanced during the quarter.

By comparison, consumers saved an average of 0.93% in Q2, with average rates decreasing from 10.54% to 9.60% after refinancing, according to Experian tracking.

“Although affordability continues to be a topic of conversation in the automotive industry, with interest rates trending downward, we’re seeing more borrowers taking the opportunity to lower their monthly payments,” Zabritski said. “Banks and credit unions remain key players in the auto refinancing space, offering a range of options that may help borrowers secure better terms.”

In Q2, Experian reported credit unions made up the overwhelming majority of automotive refinancing, increasing their share of the market from 63.22% in Q2 of last to 68.33%. Meanwhile, banks comprised 21.45%, down from 22.71% last year.

Additionally, the average monthly payment after refinancing with a credit union dropped $87, while those who refinanced with banks saved $46.

Zabritski expanded the trends happening inside of auto refinancing during another appearance on the Auto Remarketing Podcast. The conversation can be heard via the window below.