Auto Loan Early Payoff Calculator Lump Sum

How to Use This Calculator

To use the auto loan early payoff calculator:

1. Enter your current loan balance in the "Loan Balance" field.
2. Input your current monthly payment amount in the "Monthly Payment" field.
3. Specify the number of months remaining on your loan in the "Remaining Term" field.
4. Enter the lump sum amount you plan to pay in the "Lump Sum Payment" field.
5. Click the "Calculate" button to see your potential savings.

The calculator will display the total interest saved, the new loan balance after the lump sum payment, and the new loan term.

Formula Used

The calculator uses the following formulas to determine your savings:

These formulas help you understand how a lump sum payment affects your loan balance, interest payments, and the remaining term of your loan.

Worked Example

Let's look at an example to understand how the calculator works.

Example Scenario

• Loan Balance: $20,000
• Monthly Payment: $300
• Remaining Term: 60 months (5 years)
• Lump Sum Payment: $5,000

Calculations

1. Original total interest paid: 60 × $300 = $18,000
2. New loan balance: $20,000 - $5,000 = $15,000
3. New loan term: ($15,000 / $300) / 12 ≈ 4.17 years (49.9 months)
4. New total interest paid: 49.9 × $300 ≈ $14,970
5. Total interest saved: $18,000 - $14,970 = $3,030

In this example, making a lump sum payment of $5,000 saves you approximately $3,030 in interest and reduces your loan term by about 10 months.