Auto Loan Refi Calculator

Use this auto loan refinance calculator to determine if refinancing your current auto loan will save you money. Compare your current loan terms with potential refinanced terms to see if you can lower your monthly payments or reduce the total interest paid over the life of the loan.

How to Use This Calculator

Enter your current loan details and potential refinanced loan terms to calculate the savings. The calculator will show you:

Your current monthly payment
Your potential refinanced monthly payment
The difference in monthly payments
The total interest paid over the life of the loan
The total savings from refinancing

Use the results to decide whether refinancing is worth it for your situation.

How Auto Loan Refinancing Works

Auto loan refinancing is the process of replacing your current auto loan with a new one. This can be done to:

Lower your monthly payments
Shorten the loan term
Take advantage of lower interest rates
Consolidate debt

There are several types of auto loan refinancing:

Rate-and-term refinance: You refinance to get a lower interest rate and/or a shorter loan term.
Cash-out refinance: You refinance to get cash out of your existing loan, which can be used for home improvements, debt consolidation, or other purposes.
Debt consolidation refinance: You refinance multiple loans into one new loan to simplify your payments.

Before refinancing, make sure you understand the costs and benefits. Refinancing may not always be the best financial decision, especially if you're planning to sell your car soon.

Formula Used

The calculator uses the standard auto loan payment formula to calculate monthly payments:

Monthly Payment = P * (r(1 + r)^n) / ((1 + r)^n - 1)

Where:

P = Principal loan amount
r = Monthly interest rate (annual rate divided by 12)
n = Number of payments (loan term in years multiplied by 12)

The total interest paid is calculated by subtracting the principal from the total amount paid over the life of the loan.

Worked Example

Let's say you have a $20,000 auto loan with a 5% annual interest rate and a 4-year term. You want to refinance to a 3% annual interest rate and a 3-year term.

Loan Type	Principal	Interest Rate	Term	Monthly Payment	Total Interest
Current Loan	$20,000	5%	4 years	$477.52	$1,896.88
Refinanced Loan	$20,000	3%	3 years	$636.04	$792.48

In this example, refinancing would increase your monthly payment by $158.52 but would save you $1,104.40 in total interest over the life of the loan.

Frequently Asked Questions

How much can I save by refinancing my auto loan?: The amount you can save depends on your current interest rate, the new interest rate you qualify for, and the length of your loan term. Use this calculator to estimate your potential savings.
What are the costs of refinancing an auto loan?: Common costs of refinancing include application fees, credit report fees, appraisal fees, and closing costs. These can range from $500 to $1,500 or more.
How long does it take to refinance an auto loan?: The refinancing process typically takes 30 to 60 days, depending on your lender and the complexity of your situation.
Can I refinance a car loan with bad credit?: Yes, but you may have limited options and higher interest rates. Specialized lenders may offer refinancing options for borrowers with less-than-perfect credit.
Is refinancing always a good idea?: Not necessarily. You should only refinance if you can secure a lower interest rate, a shorter loan term, or better terms than your current loan. Also consider the costs of refinancing and whether you'll be in the car long enough to benefit from the savings.