Introduction
Auto refinancing means replacing your current car loan with a new one that has better terms. People refinance to get a lower interest rate, reduce their monthly payment, or pay off their loan faster. But it can be hard to tell if refinancing is truly worth it, especially when closing costs are involved.
This auto refinance calculator does the math for you. Enter your current loan details and the new loan terms you've been offered. The calculator will show you your new monthly payment, how much interest you'll save, and how long it takes to break even on any closing costs. You'll also see a side-by-side comparison, charts, and a step-by-step breakdown of every number so you can make a confident decision.
Use this tool before you visit a lender. It takes less than a minute and gives you a clear picture of whether refinancing your car loan will save you money — or cost you more in the long run.
How to Use Our Auto Refinance Calculator
Enter the details of your current car loan and the new loan terms you have been offered. The calculator will show you how much you can save each month, how much total interest you will pay, and whether refinancing is worth it.
Remaining Loan Balance: Type in how much you still owe on your car loan today. This is not the amount you first borrowed. You can find this number on your latest loan statement or by asking your lender for a payoff quote.
Current Monthly Payment: Enter the amount you pay each month toward your car loan right now. If you do not know this number, click the "Auto-estimate" button and the calculator will figure it out for you using your balance, rate, and term.
Current Interest Rate (APR): Enter the annual interest rate on your existing loan. You can find this on your loan agreement or monthly statement. Type it as a number between 0.01 and 35.99.
Remaining Loan Term: Enter how many months of payments you have left on your current loan. This must be a whole number between 12 and 84.
New Interest Rate (APR): Enter the annual interest rate that a lender has offered you for the refinanced loan. A lower rate than your current one is what saves you money.
New Loan Term: Enter the number of months you want your new refinanced loan to last. A shorter term means higher monthly payments but less interest paid overall. A longer term lowers your monthly payment but may cost more in total interest.
Down Payment: If you plan to put extra cash toward the loan when you refinance, enter that amount here. This is optional. Leave it at $0 if you do not plan to make a down payment.
Include Closing Costs: Turn this on if your lender charges fees to set up the new loan, such as title transfer or lender fees. You can enter the cost as a flat dollar amount or as a percentage of your remaining balance. The calculator uses this to figure out your break-even point and true net savings.
Once all fields are filled in, click Calculate to see a side-by-side comparison of your current loan and the new loan, savings cards, charts, and a step-by-step breakdown of the math. Click Reset at any time to return all inputs to their default values.
What Is Auto Refinancing?
Auto refinancing means you replace your current car loan with a new one. The new loan pays off the old one. You then make payments on the new loan instead. People refinance to get a lower interest rate, reduce their monthly payment, or both.
Why Would You Refinance Your Car Loan?
There are a few common reasons people refinance a car loan. Your credit score may have gone up since you first got the loan. Interest rates in the market may have dropped. Or you may just need a lower monthly payment to fit your budget. In any of these cases, refinancing could save you money.
How Auto Refinancing Works
When you refinance, a new lender pays off what you still owe on your old loan. You then owe the new lender instead. The new loan can have a different interest rate, a different term length, or both. A shorter term means higher monthly payments but less interest paid overall. A longer term means lower monthly payments but more interest over time. You can use an amortization calculator to see exactly how each payment splits between principal and interest.
What Are Closing Costs?
Some lenders charge fees to set up the new loan. These are called closing costs. They can include title transfer fees, lien fees, or lender processing charges. These costs eat into your savings, so you should factor them in before you decide to refinance.
What Is the Break-Even Point?
The break-even point is how many months it takes for your monthly savings to cover the closing costs. If you plan to sell or pay off the car before you reach that point, refinancing may not be worth it. After the break-even point, the savings are yours to keep.
When Refinancing May Not Make Sense
Refinancing is not always a good idea. If you are close to paying off your loan, the savings may be too small. If the new interest rate is not much lower than your current one, closing costs could wipe out any benefit. And if you extend the loan term by a lot, you might pay more in total interest even with a lower rate. Always compare the full cost of both loans before you decide. If you are shopping for a used car loan or considering whether to lease instead, run those numbers separately to see which option fits best. You may also want to check how your car's depreciation affects your loan-to-value ratio, since owing more than your car is worth can make refinancing harder to qualify for.