Does the season affect your car’s LTV and your chance to refinance?

Key takeaways

• Your car’s LTV changes as your vehicle’s market value changes.
• Spring and early summer are often the strongest seasons for used-car values, which can help lower your LTV.
• A lower LTV can improve your chances of qualifying for auto refinance and getting a better rate.

Yes, the time of year can affect your car loan refinance odds.

That’s because your loan-to-value ratio, or LTV, depends partly on what your car is worth today, not just what you owe. When used-car values rise in spring and early summer, your LTV can improve even if you haven’t made a big extra payment. And when your LTV improves, refinancing may get easier and cheaper. For borrowers who are close to positive equity, timing can matter more than they think.

What is LTV, and why does it matter when you refinance?

LTV stands for loan-to-value ratio. It compares how much you still owe on your car loan with how much the car is currently worth.

Here’s the formula:

LTV = current loan balance ÷ current vehicle value × 100

So if you owe $22,000 and your car is worth $24,000, your LTV is about 92%.

That matters because lenders see lower LTVs as less risky. If your car is worth more than what you owe, you have positive equity. That can make you a stronger refinance candidate. If you owe more than the car is worth, you’re underwater, and refinancing gets harder.

In general, an LTV of 100% or lower is a strong place to be. Some lenders may go higher, but borrowers below that line usually have more options. Your source material correctly centers 100% as the key threshold for better refinance odds.

How seasons can change your car’s value

Used-car prices do not move in a straight line all year. They tend to follow a seasonal pattern.

Winter: values are often softer

Early in the year, demand for used cars is often slower. Holiday spending, colder weather and lower dealership traffic can weigh on prices. If your car’s value slips, your LTV rises, which can make a refinance application less attractive to lenders. Your source file flags January and February as the weakest stretch for demand and values.

Spring: the strongest refinance window for many borrowers

Spring is where timing can start working in your favor.

Tax refund season often brings more buyers into the used-car market, which can lift demand and support prices. IRS filing-season statistics for the week ending March 6, 2026, show the average refund at $3,324, which helps explain why spring often comes with more car-shopping activity and extra cash for principal paydown.

If your vehicle value rises while your loan balance keeps falling, your LTV improves from both directions.

That’s why spring is often the best time for borrowers who were borderline underwater a few months earlier.

Summer: still favorable

Used-car values can remain relatively firm into early summer. Cox Automotive reported that the Manheim Used Vehicle Value Index rose to 208.5 in June 2025, up 6.3% year over year. That supports the idea in your source file that late spring and early summer can be a strong secondary refinance window.

Fall: depreciation tends to speed up

Fall can be tougher.

As new model-year vehicles arrive, older models can lose value faster. Auto Remarketing, citing Black Book data for October 2025, reported that the Used Vehicle Retention Index fell 1.6% month over month and 3.4% year over year, with depreciation picking up pace in October. If your car’s value falls quickly, your LTV can worsen just as you’re thinking about refinancing.

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When is the best time to refinance a car loan?

For many borrowers, the best time to refinance a car loan is late winter through early summer.

That window can work especially well because:

• used-car values may be recovering or near seasonal highs
• tax refunds can help borrowers pay down principal
• a few more months of on-time payments may strengthen both your credit profile and your refinance application

A simple example of how seasonal timing can help

Say you owe $24,500 on your auto loan.

• In January, your car might be worth $23,000. Your LTV would be about 107%.
• By April, stronger demand could lift the car’s value to $25,000. Your LTV would drop to 98%.

Nothing dramatic changed about your loan balance. But the vehicle value changed enough to alter your refinance profile.

Other factors that matter more than season alone

Seasonality helps, but it is not the only thing lenders care about.

Your credit score

If your credit has improved since you got your current loan, refinancing may make sense in almost any season. A stronger score can improve your approval odds and may help you qualify for a lower APR.

How long you’ve had the loan

Most lenders want to see at least six months of payment history before approving a refinance. Bankrate notes that many lenders require six months on the current loan before you can qualify.

Your remaining balance and term

If you’re close to paying off the loan, refinancing may not be worth the effort. Some lenders also require a minimum balance, often a few thousand dollars, to refinance.

Current refinance rates

Even with perfect timing on LTV, refinancing is only worth it if the numbers improve. A lower APR, a more manageable monthly payment or both should be the goal.

How to check whether now is a good time to refinance

Before applying, do these three things:

1. Check your car’s current value

Use a pricing guide such as Kelley Blue Book or Edmunds to estimate what your car is worth today.

2. Find your current loan balance

You can usually see this in your lender portal or monthly statement.

3. Calculate your LTV

Divide the loan balance by the vehicle value, then multiply by 100.

Then ask:

• Is my LTV below 100%?
• Has my credit improved?
• Have I had the loan at least six months?
• Would a refinance lower my APR, payment or both?

If the answer to most of those is yes, it may be a good time to check offers.

Payment history is one of the biggest factors in your credit score. Setting up autopay or payment reminders can help you avoid missed due dates.

Bottom line

The best time to refinance a car loan is not just about interest rates. It can also be about your car’s value.

If spring or early summer lifts used-car prices, your LTV may improve enough to strengthen your refinance application. For borrowers close to positive equity, that seasonal shift can be the difference between waiting and qualifying.

A good next step is simple: check what your car is worth, compare it with your loan balance and calculate your LTV. If the numbers look better than they did a few months ago, this may be the right moment to shop refinance offers.

FAQs: Does the season affect LTV and auto refinance?

Does the time of year really affect car loan refinancing?

Yes. Your car’s value affects your LTV, and used-car values tend to move seasonally. If your car is worth more in spring or early summer, your LTV may improve, which can make refinancing easier.

What LTV do I need to refinance a car?

There’s no single universal cutoff, but borrowers at or below 100% LTV are generally in a much stronger position than borrowers above it. Some lenders may allow higher LTVs, but options usually get narrower as LTV rises.

How long should you wait before refinancing a car?

Usually at least six months. Many lenders want to see a track record of on-time payments before approving a refinance.