The American Southwest was made for the automobile.
In Texas, few things are as breathtaking as venturing out to see the magnificent and unheralded Palo Duro Canyon. A couple of states west, there’s a slightly more famous canyon to check out, but the drive between Flagstaff and Sedona is as impressive and inspiring as anything the Grand Canyon State has to offer.
It’s drives like these that make you love your car. But imagine how great these drives could feel if you just saved hundreds or thousands of dollars from refinancing your auto loan.
According to a recent Credit Karma analysis on auto refinancing savings, Americans can potentially save $37 billion by refinancing their car loans. For this report, we crunched the data to find the cities with the biggest opportunity for savings, in total and per capita.
At the top of the list are big, car-centric cities such as Los Angeles ($289 million in potential savings) and Houston ($264 million in potential savings). Of the top 10, eight are in Sunbelt states like Texas, California and Florida.
And the size of the city doesn’t tell the whole story. Fort Worth, Texas, which has an adult population of about 613,000, ranks eighth, with nearly $109 million in savings opportunities. New York, on the other hand, has an adult population of 6.7 million but offers just $60 million in potential savings, ranking 28th overall.
These savings figures were derived from aggregated and anonymized auto “tradelines” – an industry term for loans appearing on credit reports. First, we determined the potential savings for Credit Karma members in 99 of the largest cities in the U.S. Then we extrapolated those results using data from TransUnion and the U.S. Census Bureau to achieve a roughly representative national snapshot.
Next, we calculated how much residents in each city could save on a per capita basis over the lifetime of their auto loan using the same representative calculation based on data from Credit Karma, TransUnion and the U.S. Census Bureau. Note: This is based on the average savings for every resident – not just those with an auto loan or a car. This could mean cities with high rates of car ownership likely score higher, while cities with lower rates, like New York, score lower.
Read more about our methodology here.
Of course, correlation does not equal causation. Car owners with an auto loan – no matter where they live – could have an opportunity to save, whether they live in top-ranked Winston-Salem, N.C., or 99th-ranked New York City.
Top 25 cities where you could save the most from refinancing your auto loan
Here’s what we found when we crunched the numbers to find the cities with the highest potential savings per capita.
1. Winston-Salem, N.C.
Per Capita Savings: $305
Total City Savings (in millions): $56.2
Winston-Salem is far and away the biggest potential beneficiary of refinancing savings per capita. Motorists have an average commute time of 20 minutes, which is shorter than the 25-minute average of all cities analyzed.
2. Gilbert, Arizona
Per Capita Savings: $206
Total City Savings (in millions): $33.6
Of the 99 cities analyzed, Gilbert has the most households with two or more cars (75 percent of households). Lots of cars equals lots of potential savings.
3. El Paso, Texas
Per Capita Savings: $195
Total City Savings (in millions): $97.1
Nearly a quarter of El Paso households have three or more cars, so west Texas homeowners might want to look in their garages and driveways for savings.
4. Corpus Christi, Texas
Per Capita Savings: $192
Total City Savings (in millions): $46.9
In Corpus Christi, 83 percent of commuters drive to work alone. That’s the sixth most of any city analyzed, so there are plenty of car owners in this Gulf Coast city who can put money back into their pockets.
5. Colorado Springs, Colo.
Per Capita Savings: $187
Total City Savings (in millions): $66
Colorado Springs is one of the most affordable cities relative to income. Median monthly homeownership costs equal about 29 percent of median income, well below the average of 35 percent for the cities analyzed. Affordable housing plus big potential car refinancing savings equals happy residents.
6. Glendale, Ariz.
Per Capita Savings: $186
Total City Savings (in millions): $34.9
Glendale residents can save an average of $186. What’s unusual is that 9 percent of households have no car, the second most among the top 25. That means potential refinancing savings is even more concentrated across car owners.
7. Chandler, Ariz.
Per Capita Savings: $181
Total City Savings (in millions): $33.4
It gets hot in Arizona. No wonder just 0.4 percent of Chandler residents walk to work, the second-lowest percentage of all cities analyzed. Sitting in an air-conditioned car is great. Sitting in that cool car after pocketing a citywide average of $181 is even better.
8. Fort Worth, Texas
Per Capita Savings: $177
Total City Savings (in millions): $108.6
At 28 minutes, the average commute in Fort Worth is longer than the 25-minute average of all cities analyzed. That average $177 savings takes a bit of the frustration out of sitting in bumper- to-bumper traffic on Interstate 35W.
9. Mesa, Ariz.
Per Capita Savings: $175
Total City Savings (in millions): $63.9
Across the top 25 cities, Mesa residents have the third-lowest rate of commuting alone. Saving money is more fun when you can share it with others.
10. San Antonio, Texas
Per Capita Savings: $173
Total City Savings (in millions): $193.2
San Antonio not only has one of the highest potential savings rates per capita, residents could save about $193 million, the fourth-highest total across all 99 cities analyzed. That can buy a lot of puffy tacos.
11. Arlington, Texas
Per Capita Savings: $170
Total City Savings (in millions): $49.7
According to U.S. Census Bureau data, just 0.2 percent of Arlington residents commute by public transit, the lowest rate among cities analyzed. Luckily for these motorists, there is an average of $170 in potential refinancing savings in Arlington.
12. Aurora, Colo.
Per Capita Savings: $169
Total City Savings (in millions): $45.5
Aurora is a bit unusual in that 3.7 percent of residents commute by public transportation, the highest across the top 25 cities. That’s on top of the 13 percent of commuters who carpool, the seventh highest across all cities.
13. Garland, Texas
Per Capita Savings: $167
Total City Savings (in millions): $28.1
The average commute for a Garland resident is 30 minutes, the second longest across the top 25 cities.
14. Laredo, Texas
Per Capita Savings: $164
Total City Savings (in millions): $28
Laredo can be expensive. Homeowner costs eat up about 40 percent of median income – the highest across the top 25 cities. Refinancing your auto loan could help ease the burden of those mortgage payments.
15. Henderson, Nev.
Per Capita Savings: $161
Total City Savings (in millions): $36.7
Residents of this Las Vegas Valley city like their cars. About 83 percent of residents commute alone, the third-highest percentage in the top 25. And just 7.3 percent of commuters carpool, the second lowest in the top 25.
16. Lubbock, Texas
Per Capita Savings: $160
Total City Savings (in millions): $31
The average commute time for Lubbock residents is 16 minutes, the shortest commute across all 99 cities. Less time in the car, more time to research refinancing your auto loan.
17. Fort Wayne, Ind.
Per Capita Savings: $160
Total City Savings (in millions): $31.1
Nearly 84 percent of Fort Wayne commuters drive to work alone. That’s the second-highest percentage across all 99 cities analyzed. More commuters, more savings.
18. Wichita, Kan.
Per Capita Savings: $159
Total City Savings (in millions): $46.2
Like Fort Waynites, Wichitans are fond of commuting alone. More than 83 percent of residents commute alone, the third-highest percentage across all 99 cities.
19. Riverside, Calif.
Per Capita Savings: $159
Total City Savings (in millions): $39
Riverside has the third-highest rate of carpooling in the cities analyzed, so residents of this Inland Empire city already know how to save a few bucks. Refinancing could only add to local piggy banks.
20. Albuquerque, N.M.
Per Capita Savings: $158
Total City Savings (in millions): $68
Albuquerque residents could save a total of $68 million. If you’re looking at the total savings opportunity across the 99 cities analyzed, this comes in at No. 21. Go ahead, splurge on a few green chile cheeseburgers.
21. Boise, Idaho
Per Capita Savings: $157
Total City Savings (in millions): $27
Not only do Boiseans have the second-shortest average commute time across the top 25 cities, but they can potentially save an average of $157 per adult resident by refinancing their auto loans. That’s a lot of potatoes.
22. Chesapeake, Va.
Per Capita Savings: $156
Total City Savings (in millions): $28.2
In this Virginia city, 83% of residents commute to work alone, which is the fifth-highest percentage of all cities analyzed.
23. Jacksonville, Fla.
Per Capita Savings: $155
Total City Savings (in millions): $105.3
About 52 percent of Jacksonville households have two or more cars – the third lowest of the top 25 cities. Even though there may be fewer cars per household, there are still valuable potential refinancing opportunities available.
24. Houston, Texas
Per Capita Savings: $153
Total City Savings (in millions): $263.8
Houston has the second-highest total savings potential of any city analyzed. That means each of the city’s 1.7 million residents could save $153, on average.
25. Virginia Beach, Va.
Per Capita Savings: $153
Total City Savings (in millions): $53.6
In Virginia Beach, about 3.3 percent of commuters walk to work, the most in the top 25. Already saving on gas (and getting exercise), residents can save on their auto loans too.
Many of these cities have big savings opportunities simply because they have more cars per person. After all, fewer residents of New York would benefit from refinancing than Sunbelt residents because fewer people have cars. But the bottom line is clear: Car owners should see if they could save money by refinancing their car loans, whether they live in big, dense northeast cities or suburban tracts in the Southwest.
Credit Karma auto tradelines analysis: To arrive at a total U.S. figure for potential refinancing savings, we began by analyzing auto tradelines for U.S. Credit Karma members by APR and credit score range. Our analyst determined which tradelines were “refinanceable” by applying discounts to each of these ranges based on average approval rates and likelihood of receiving savings. That number of tradelines was multiplied by the average interest savings for members who took refinancing offers found through Credit Karma in their credit score range.
Next, since not every U.S. car owner is a member of Credit Karma, we extrapolated the data to represent the wider population by city. We made the assumption that the proportion of individuals with an auto tradeline is the same for both Credit Karma members and the broader U.S. population. To get this representative number on a national level, we used:
- The average interest savings for Credit Karma members by score range and city from the analysis above
- The number of Credit Karma users by score range and city
- TransUnion® data on the percentage of people by score range and city
- 2016 U.S. Census Bureau estimates for the size of the U.S. adult population
To calculate the average savings number, we took the number of “refinanceable” Credit Karma members compared to that city’s total population. We assumed that this ratio is representative of the entire city, and divided the total savings opportunity by that “refinanceable” population estimate.
We also looked at data from the U.S. Census Bureau’s 2016 American Community Survey and compared it to the average savings opportunities by city to calculate the correlations between refinancing savings and economic and demographic factors.