Steer Clear of Auto-Loan Refinancing

Refinancing -- it's not just for homeowners anymore.

Over the past few years, car owners have also taken advantage of declining interest rates and refinanced their auto loans at lower rates. But in doing so, many have kept themselves on the debt treadmill, opting for a little monthly savings at the expense of higher costs over the life of the loan.

"It's on the rise -- 450,000 people will refinance their car loans this year, nearly three times the 172,934 people who refinanced in 1999 and 297,363 who refinanced in 2001," said Art Spinella, vice president and general manager at auto-market researcher CMW. "The low interest rates are a key part of the increased demand." ...