Can You Refinance a Car Loan If You Receive SSI? Here's What You Need to Know

When you can't keep up with your monthly bills because of your auto loan payment, it might be time to refinance. However, you might worry about whether you qualify if you receive supplemental security income (SSI). Can you refinance a car loan if you have SSI, and will your disability benefits hurt or help your chances of approval?

Refinancing car loans is a good option for many people — including SSI recipients. Before you start reaching out to lenders, it's helpful to know what to expect and how your monthly benefits could come into play.

Understanding Car Loan Refinancing

When you refinance, you take out a loan on a car that already has an existing loan. The refinance lender pays off the initial loan balance, and you begin making monthly payments for the new loan.

People often refinance their auto loans to save money. For example, if interest rates have decreased since you originally purchased your car, a car refinancing loan could help you save money by giving you a lower annual percentage rate (APR). You could also lower your monthly payments by extending your loan term.

Can You Refinance a Car Loan While Receiving SSI?

SSI shouldn't prevent you from refinancing your car loan because most lenders accept it as a source of income. You'll need to provide documentation identifying how much you currently receive in monthly benefits. Many people submit tax returns and eligibility letters from the Social Security Administration (SSA) as income verification.

Keep in mind that lenders also look at a variety of other factors, including your overall financial health, to determine whether you qualify for a refinance. In addition to your monthly income, they consider your debt-to-income (DTI) ratio. Your DTI compares your monthly income to your debts, such as your mortgage and credit cards. The lender will also factor in your credit history, including whether you've made late payments or have any delinquent accounts.

Challenges of Refinancing on SSI

People receiving SSI face many of the same hurdles as other applicants hoping to refinance their auto loans:

• Income requirements: As of 2025, the maximum monthly SSI payment you can receive is $967 for an individual or $1,450 for a couple. If your household doesn't have additional income, you may not make enough money to satisfy the lender.
• Credit score limits: Although the specific number differs from one lender to the next, most require you to meet their credit score requirements to qualify for a loan. Even if an SSI recipient doesn't have bad credit due to missed payments, a limited credit history can make approval more difficult as well.
• Lender restrictions: Lenders may not be willing to refinance a vehicle if it's more than 10 years old or has high mileage. In addition, the lender might reject your loan application if your current balance is too low or high.

Remember that some lenders are more flexible than others. One rejection doesn't mean that refinancing is impossible, so look at loan reviews to find a lender willing to work with you.

How To Improve Your Chances of Getting Approved

Lender decisions are often unpredictable and shift based on changes in the market. However, you can take a few steps to make your refinance approval more likely.

Use a Co-Signer or Alternative Income Sources

In some cases, refinancing an auto loan is more difficult if SSI is your primary source of income because your benefits aren't subject to garnishment. If a lender is hesitant to offer you a refinance, look for ways to reduce their risk.

If you have a friend or family member with strong credit, ask them to co-sign the loan. You can also add other income sources, such as alimony payments, to your application. If you work part-time, those earnings can help as long as they don't exceed the SSA's limits, causing them to reduce or stop your benefits.

Make a Larger Down Payment to Strengthen Your Application

If you have enough cash available, making a bigger down payment can ameliorate the lender's concerns. A down payment means the total loan balance is lower and shows financial stability. They might also offer you a better interest rate and more favorable loan terms if you put more money down.

Alternatives if Refinancing Isn't an Option

Don't give up if refinancing doesn't work out. Instead, look for other ways to alleviate your financial stress.

Approaching Your Current Lender

If you have a record of on-time payments, your present lender may be willing to negotiate a lower monthly amount. You can also explore restructuring your current loan to extend the terms or adjust your interest rate. Some lenders offer auto loan hardship programs, temporarily deferring payments until your financial health improves.

Finding Other Funding Sources

Support and funding are sometimes available from other sources. Consider applying for a personal loan instead of an auto refinance.

Researching state and local organizations is another option. Community groups and government agencies often offer assistance programs for people who receive SSI.

For instance, if you're a veteran receiving SSI, you may qualify for an automobile allowance through the U.S. Department of Veterans Affairs. You can use this money to purchase a new car and sell the old one. However, it may not be possible if your existing loan balance is higher than the vehicle's value.

Taking a Step Back

If you can manage your current payments for another 12 to 18 months, consider waiting and reapplying for a refinance. This pause gives you time to save money for a down payment and reduce your credit card debt. Ultimately, you'll be better positioned to approach new lenders when your financial situation improves.

Making the Best Decision for Your Car Loan and Financial Future

Refinancing your auto loan can add breathing room to your monthly budget, and receiving disability benefits shouldn't stop you from applying. As long as you meet the lender's criteria, you can refinance a car loan if you have SSI.

Money Atlas helps you compare options when making big financial decisions. Explore the best auto loans to find a lender with car loan refinancing rates that work for you.