Car refinance calculator
Compare your current auto loan with a refinance offer.
- Formula and assumptions shown
- Table and CSV export
- Runs in your browser
How it works
Enter what you owe, your current rate, and the months left, then the new rate, term, and any refinance fees. The calculator compares the two monthly payments, the interest left on each loan, and the lifetime difference including fees.
Payment = B × r ÷ (1 − (1 + r)^−n) for each loan. Lifetime savings = current loan interest − new loan interest − fees. Simple fee break-even = upfront fees ÷ monthly payment reduction, rounded up.
A lower payment is not the same as a cheaper loan. Stretching the term can cut the payment while adding interest, so the result warns you first when the refinance costs more overall.
Assumptions
- Both loans are fixed-rate with monthly payments; the new loan starts today.
- Fees are either paid upfront in cash or added to the new balance and repaid with interest.
- Prepayment penalties on the current loan, taxes, add-on products, and credit effects are excluded.
- Rates are the ones you enter; no live offers are fetched.
Worked example
$20,000 at 9% with 48 months left
Refinancing to 6% for 48 months with $300 of fees paid upfront drops the payment from $497.70 to $469.70, so the new payment is lower by $28.00. The fees are recovered in 11 months, and over the full term you save $1,044.01 after fees.
Step by step
- Compute the current payment. 9% ÷ 12 = 0.75% a month over 48 months: $20,000 × 0.0075 ÷ (1 − 1.0075^−48) = $497.70.
- Compute the new payment. 6% ÷ 12 = 0.5% a month over 48 months: $469.70, which is $28.00 lower.
- Compare the interest left on each loan. Current loan: 48 × $497.70 − $20,000 = $3,889.64. New loan: 48 × $469.70 − $20,000 = $2,545.63.
- Subtract the fees. $3,889.64 − $2,545.63 − $300 = $1,044.01 of lifetime savings after fees.
- Find the fee break-even. $300 ÷ $28.00 = 10.7, rounded up to 11 months of lower payments to recover the fees.
How to read your result
The headline shows how much the new payment is lower (or higher) than the current one. The secondary figures show both payments, the interest remaining on each loan, lifetime savings including fees, and the simple fee break-even. The summary line states the lifetime result first, and when the refinance costs more over its full term, that warning comes first.
Lifetime savings is the figure that answers whether the refinance is cheaper; the payment difference answers whether it frees cash each month. The two can point in opposite directions when the new term is longer. The break-even counts months of payment reduction needed to recover upfront fees, and it is not shown when fees are rolled into the loan, because no upfront cash is spent.
The chart and table follow both balances and payments month by month. Prepayment penalties on the current loan, add-on products such as GAP coverage or service contracts, title and registration charges not entered as fees, and any change in credit score are not modeled.
What changes the result most
- New loan term
- At 6%, a 60-month term lowers the payment by $111.04 but saves only $390.28 after fees; a 72-month term lowers it by $166.24 and costs $275.32 more than keeping the current loan. A 36-month term raises the payment by $110.74 and saves $1,685.85.
- New rate
- With the same 48-month term and $300 fee, 7.5% saves $377.89 and takes 22 months to break even; 8% saves $153.24 and takes 32 months; 4% saves $1,913.75 and breaks even in 7 months.
- Fees and how they are paid
- Doubling the fee to $600 cuts lifetime savings to $744.01 and doubles the break-even to 22 months. Rolling the $300 into the loan instead raises the new payment to $476.75 and cuts savings to $1,005.83; the $38.18 difference is interest on the financed fee.
Questions
Can a lower payment cost more?
Yes. A longer term can lower the payment but add months of interest. When the refinance costs more over its full term, the result says so first.
Should I roll fees into the new loan?
Rolling fees in avoids paying cash now, but you pay interest on them. The calculator counts rolled fees and their interest in the lifetime comparison.
Does my current loan have a prepayment penalty?
Check your contract and state law. A penalty would add to the cost of refinancing and is not included here.
Is it worth refinancing a car loan?
It depends on the lifetime savings after fees, the months to break even, and how long the car and loan will be kept. In the example, a 3-point rate cut on $20,000 with 48 months left saves $1,044.01. The same rate stretched to 72 months lowers the payment more but costs $275.32 extra, so both the payment and the lifetime figure matter.
Does refinancing a car hurt your credit?
Applying usually involves a hard inquiry, which can lower a score slightly for a time, and a new account lowers the average age of accounts. Scoring models often count several auto-loan inquiries within a short shopping window as one. Paying the new loan on time builds payment history as the old one did.
Can I refinance a car loan with bad credit?
Some lenders refinance borrowers with lower credit scores, usually at higher rates, and each lender sets its own criteria. Entering an offered rate here shows whether it lowers the payment and the total cost after fees compared with the current loan.
More in Loans & debt
Sources
- CFPB: can I prepay my auto loan without penalty?
- CFPB: auto loan options, including refinancing
- CFPB: what is amortization?
These references explain the concepts behind the calculation. They do not endorse this site. Estimates leave out any cost or condition you did not enter.