Auto Loan Refinance Calculator
How much can you save by refinancing your auto loan?
Compare your current loan with a refinance offer to estimate payment and total interest savings.
Should You Refinance Your Car Loan?
Refinancing lets you swap a high-rate loan for a better one. If your credit improved or market rates dropped, you could save hundreds per month and thousands in total interest.
Use this calculator to
- Compare current loan vs refinance offer
- Calculate monthly payment reduction
- See total interest savings over the loan
- Factor in refinancing fees and break-even
You will get
- Monthly savings (or cost increase)
- Total interest savings over loan life
- Clear recommendation: refinance or stay
- Break-even timeline for any fees
Quick Result
Based on
- • Balance: $25,000.00
- • Current Rate: 8.5%
- • New Rate: 5.5%
- • New Term: 48mo
1Current Loan
2New Loan Offer
Excellent candidate for refinance! You save monthly and total interest.
Monthly Payment
Total Interest
Lifetime Savings
Loan Comparison
This tool is for illustrative purposes only and does not constitute professional financial, tax, or legal advice. Calculations are estimates and may not reflect real-world variables or local regulations. Always consult with a qualified professional before making financial decisions.
Methodology and Trust
Formulas
Monthly Savings
Current Payment - New Payment
Total Interest
Total Payments - Principal
Recommended Next Steps
Continue your journey with these related tools
Auto Refinancing: The Reset Button for Your Loan
Key Insights & Concepts
Did you buy your car with "bad credit" financing? Or did you buy it when interest rates were at a historic peak? If so, you are likely overpaying by thousands of dollars. Refinancing is the "Reset Button"—it allows you to swap your bad loan for a good one.
The Perfect Candidate
You are the ideal candidate for refinancing if:
- Your Credit Improved: If your score jumped from 620 to 720, you moved from "subprime" (15% rates) to "prime" (6% rates). That spread is massive.
- Rates Dropped: If the Federal Reserve cut rates since you bought your car, market rates might be lower across the board.
- You Got "Dealer'd": Sometimes dealers mark up the interest rate to make extra profit. A credit union won't do that. You can refinance just to strip away the dealer markup.
The Term Trap: Proceed with Caution
There are two ways to lower your monthly payment:
1. Lower the interest rate (Good).
2. Extend the loan term (Bad).
Be very careful. If you have 36 months left on your loan and you refinance into a new 60-month loan, your payment will drop drastically, but you will stay in debt for 2 extra years and likely pay more total interest.
The Golden Rule: Try to keep the term the same (or shorter). If you have 42 months left, try to refinance into a 36 or 42-month term. Only extend the term if you are in a financial crisis and absolutely need the lower payment to survive.
The LTV Limit
Banks have limits. They generally will not lend more than 120-130% of the car's value (LTV). If you are deeply "underwater" (you owe $20k on a car worth $12k), you might be rejected for refinancing even if you have perfect credit. You may need to bring cash to the table to pay down the balance to get approved.
Gap Insurance Refund
This is a pro tip that few people know. If you bought GAP insurance or an Extended Warranty from the dealer when you bought the car, and you refinance, you are entitled to a pro-rated refund of those products.
Since you are paying off the original loan, that GAP policy ends. If you are 2 years into a 5-year loan, you should get roughly 60% of your GAP money back. You have to ask for it—they won't send it automatically!