Auto Loan Refinance Calculator
Example: Current loan balance: 22000 $ · Current APR: 9.5 % · Months remaining: 48 months · New APR: 6 % · New term: 48 months
| Monthly savings | $36 |
| Total interest savings | $1,730 |
| Current payment | $553 |
| New payment | $517 |
Worked example
Say you owe $22,000 with 48 months left at 9.5%, a payment of about $554. Refinance to 6% over the same 48 months and the payment falls to roughly $517, saving about $37 a month. Because you kept the term the same, that monthly saving compounds into roughly $1,760 less interest over the life of the loan — real money for a single application.
Frequently asked questions
When does refinancing a car make sense?
It usually pays off when the new rate is meaningfully lower than your current one, your credit has improved, or you are early enough in the loan that interest still makes up a large share of each payment. If you only have a few months left, the savings are small.
Does keeping the same term matter?
Yes. Lowering the rate while keeping the same number of months captures the full interest savings. Extending the term lowers the monthly payment but can wipe out or reverse the total savings, so compare the total-savings line, not just the payment.
Will refinancing hurt my credit?
A refinance application triggers a hard inquiry, which can dip your score a few points temporarily. Shopping multiple lenders within a short window is typically treated as a single inquiry. The long-term benefit of a lower rate usually outweighs the small dip.
Can I refinance if I owe more than the car is worth?
It is harder. Lenders prefer a loan-to-value ratio below 100%. If you are underwater, you may need to pay down the balance first or find a lender that allows higher LTV, often at a higher rate.