Auto Loan Refinance Calculator
See how much you can save by lowering your rate
What Is an Auto Loan Refinance Calculator?
An auto loan refinance calculator helps you determine whether replacing your current car loan with a new one could save you money. Refinancing typically involves lowering your interest rate, changing your loan term, or both. This calculator shows how those changes affect your monthly payment, total interest, and overall savings.
By entering details from your existing loan alongside the terms of a new loan, you can instantly compare both scenarios. Instead of guessing, you get clear numbers that show whether refinancing makes financial sense for you right now.
How Auto Loan Refinancing Works
When you refinance an auto loan, you are essentially paying off your remaining balance with a new loan that has different terms. The goal is usually to secure a lower interest rate, reduce your monthly payment, shorten the loan term, or achieve a combination of all three.
This calculator compares two loans side by side. The first is your current loan, based on what you still owe and your existing interest rate. The second is the new loan, based on the rate and term you are considering. From there, it calculates the difference in payments and interest costs.
Explanation of Input Fields
To get accurate results, it helps to understand what each field represents and why it matters.
Remaining Loan Balance
This is the amount you still owe on your current auto loan. It does not include what you originally borrowed—only the unpaid portion. This balance becomes the starting principal for both the current loan calculation and the refinanced loan estimate.
Current Interest Rate
This is the annual percentage rate on your existing loan. Even a small difference in this number can significantly affect how much interest you pay over time.
Remaining Term
This is the number of months left until your current loan is paid off. The calculator uses this to determine your current monthly payment and remaining interest cost.
New Interest Rate
This is the rate offered by a lender if you refinance. Lowering this rate is one of the main reasons refinancing can save money.
New Loan Term
This is the length of the refinanced loan in months. A shorter term usually means higher monthly payments but less total interest, while a longer term lowers monthly payments but may increase overall interest.
How the Calculator Performs the Math
The calculator uses the standard auto loan amortization formula to compute monthly payments for both loans.
Monthly Payment Formula
The formula used is:
Monthly Payment =
P × ( r × (1 + r)ⁿ ) ÷ ( (1 + r)ⁿ − 1 )
Where:
P is the remaining loan balance
r is the monthly interest rate (annual rate ÷ 12 ÷ 100)
n is the number of remaining months
This formula ensures each payment includes both principal and interest, with interest making up a larger portion early in the loan and decreasing over time.
How Interest and Savings Are Calculated
Once the monthly payment is calculated, total interest is determined using:
Total Interest = (Monthly Payment × Loan Term) − Loan Balance
The calculator runs this calculation twice—once for your current loan and once for the new loan. The difference between the two totals represents your estimated interest savings from refinancing.
Monthly savings are calculated by subtracting the new payment from your current payment.
Understanding the Results
After entering your information, the calculator shows several key results.
Your current payment reflects what you are paying now based on your existing loan terms.
Your new payment shows what you would pay after refinancing.
Your monthly savings highlight the difference between the two payments.
Your total interest savings show how much interest you could avoid paying over the life of the loan.
The payoff date estimates when your refinanced loan would be fully paid off.
The visual chart compares the total cost of both loans, breaking each one into principal and interest so you can clearly see how refinancing changes the overall cost.
When Refinancing Makes Sense
Refinancing often makes sense if interest rates have dropped since you took out your original loan, your credit score has improved, or you want to adjust your monthly payment to better fit your budget. However, extending the loan term can increase total interest even if the monthly payment is lower, which is why comparing both scenarios is important.
This calculator allows you to test different rates and terms so you can make a confident, informed decision.
Final Thoughts
An auto loan refinance calculator gives you clarity before you commit to a new loan. By showing both the monthly impact and the long-term cost, it helps you decide whether refinancing will truly save you money or simply rearrange your payments. With a clear breakdown of payments, interest, and payoff timing, you can move forward knowing exactly what to expect.