Auto Refinance Pre Approval Calculator
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Reviewed by Calculator Editorial Team
Refinancing your auto loan can save you money if interest rates have dropped since you originally took out your loan. This calculator helps you estimate your potential savings and approval odds before applying for a refinance.
How the Calculator Works
The Auto Refinance Pre-Approval Calculator estimates your potential savings by comparing your current auto loan terms with what you could get by refinancing. It factors in:
- Your current loan balance
- Current interest rate
- Proposed new interest rate
- Loan term (how long you want to repay the loan)
- Your credit score (which affects approval odds)
The calculator shows you estimated monthly payments and total interest savings over the life of the loan. It also provides an estimated approval probability based on your credit score.
How to Use This Calculator
- Enter your current loan balance
- Enter your current interest rate (APR)
- Enter the proposed new interest rate you're considering
- Select your desired loan term (in years)
- Enter your estimated credit score
- Click "Calculate" to see your results
Important Notes
This calculator provides estimates only. Actual savings and approval odds may vary based on your specific financial situation and the lender's underwriting criteria.
Example Calculation
Let's say you have a $20,000 auto loan with a 6.5% interest rate that you want to refinance to a new rate of 4.5% over 5 years. With a credit score of 720, the calculator might show:
| Metric | Current Loan | Refinanced Loan |
|---|---|---|
| Monthly Payment | $371.43 | $303.06 |
| Total Interest Paid | $5,236.80 | $3,206.80 |
| Total Savings | $2,030.00 | |
| Approval Probability | 85% |
This example shows you could save $2,030 over 5 years by refinancing, with an 85% chance of approval based on your credit score.
Formula Used
Monthly Payment Calculation
The monthly payment is calculated using the standard loan payment formula:
M = P [ i(1 + i)n ] / [ (1 + i)n - 1 ]
Where:
- M = Monthly payment
- P = Principal loan amount
- i = Monthly interest rate (annual rate divided by 12)
- n = Number of payments (loan term in years multiplied by 12)
Total Interest Calculation
Total interest paid is calculated by multiplying the monthly payment by the number of payments and subtracting the principal loan amount.
Approval Probability Estimation
The approval probability is estimated based on your credit score using the following ranges:
- 300-579: 10-20%
- 580-669: 25-40%
- 670-739: 50-65%
- 740-799: 70-80%
- 800-850: 85-95%