Auto Loan Refinance Calculator
An auto loan refinance calculator compares your current car loan to a new one, showing your new monthly payment and how much you save (or lose) in total interest. Enter your current balance, APR, and months remaining, plus the new APR and term a lender is offering, into the calculator above to see both loans side by side.
For example, refinancing a $22,000 balance with 42 months left from 9.5% APR down to 6.5% APR on a new 42-month loan drops the payment from $617.76 to $587.06 a month and saves $1,289.41 in interest over the life of the loan.
How it's calculated
Refinancing swaps your current auto loan for a new one, ideally at a lower APR, a shorter remaining term, or both. The calculator above rebuilds both loans' amortization schedules using the same balance: your current loan finishing out its remaining months, and a new loan starting fresh at the new APR and term. It then compares scheduled payment and total interest side by side. According to Experian, the average refinanced auto loan carried an 8.45% APR as of June 2025, about 2 percentage points below the 10.45% average rate borrowers held on the loan before refinancing. A lower APR, an improved credit score since your original loan, or wanting to remove a co-borrower are the most common reasons to refinance. See the auto loan interest calculator to check how your current rate compares to today's typical APR by credit tier.
Pairing a lower rate with a longer term can erase most of the interest savings you were expecting. Take that same $22,000 balance at 9.5% APR with 42 months left, but refinance it into a 6.5% APR loan stretched to 60 months instead of 42. The payment falls further, from $617.76 to $430.46, a $187.31 monthly drop. But total interest on the new loan is $3,827.32, barely below the $3,945.99 you would pay by keeping the original loan. Stretching the term ate almost all of the savings a lower rate should have delivered.
A worked example
Say you owe $22,000 with 42 months left on your current loan at 9.5% APR. Keeping that loan as-is, you would pay $617.76 a month and $3,945.99 in total interest before it is paid off.
A lender offers to refinance the same $22,000 balance at 6.5% APR for a new 42-month term. The calculator above shows a new payment of $587.06, a drop of $30.70 a month, and total interest of $2,656.58.
That is $1,289.41 saved in interest over the life of the loan, with no change to how long you will be making payments. Enter your own balance, rate, and term in the calculator above to see your numbers.
Common mistakes to avoid
- Comparing only the new monthly payment, not total interest. A lower payment from a longer term can leave your total interest cost almost unchanged, as the 60-month stretch example above shows.
- Refinancing with negative equity. Experian notes that owing more than the car is worth makes refinancing hard to qualify for and can roll the shortfall into an even larger new loan.
- Skipping the prepayment penalty check on your current loan. The CFPB confirms some auto loans carry one, so confirm you will not owe a fee to pay off the old loan before refinancing.
- Trying to refinance a car that is too old or has too many miles. Many lenders will not refinance vehicles over about 10 years old or past 100,000 miles, per Experian.
- Applying to several lenders with full hard-pull applications instead of comparing prequalified, soft-pull offers first, which Experian notes many lenders allow.
Frequently asked questions
How do I calculate auto loan refinance savings?
Compare your current loan's remaining interest to your new loan's total interest, run through the same amortization math your lender uses. A $22,000 balance at 9.5% APR with 42 months left would cost $3,945.99 in remaining interest if kept as-is. Refinance that balance into a 6.5% APR, 42-month loan and total interest drops to $2,656.58, a savings of $1,289.41. Use the calculator above with your own balance, rate, and term.
Is it worth it to refinance my car loan?
Refinancing is usually worth it when your new APR is meaningfully lower and your car still qualifies. Experian reports the average refinanced auto loan carried an 8.45% APR as of June 2025, about 2 percentage points below the 10.45% average rate borrowers held before refinancing. Most lenders will not refinance vehicles over roughly 10 years old or past 100,000 miles, and you generally need positive equity, meaning the car is worth more than you owe.
What credit score do I need to refinance an auto loan?
There is no fixed minimum, but your score sets the rate a lender offers. Experian's Q1 2026 data shows used-car APRs (the closest comparison for a refinance) of 6.30% for super-prime borrowers (781+), 8.77% for prime (661-780), 14.03% for near-prime (601-660), and 19.42% or higher for subprime (below 600). If your score has moved into a higher tier since your original loan, refinancing can capture a meaningfully lower rate.
Does refinancing my car loan hurt my credit?
A single refinance causes only a small, temporary dip. A hard credit inquiry and a new account can each shave a few points, but shopping multiple lenders within a focused window typically counts as one inquiry for scoring purposes. Many lenders also offer a soft-pull prequalification, so you can compare offers before any hard inquiry touches your score.
Should I refinance into a longer term to lower my payment?
A longer term can shrink your payment while barely touching your total interest cost, so compare both numbers before choosing it. Refinancing a $22,000 balance at 9.5% APR with 42 months left into a 6.5% APR, 60-month loan drops the payment to $430.46, a bigger monthly drop than the 42-month refinance above. But total interest only falls to $3,827.32, barely below the $3,945.99 you would pay by keeping the original loan. You would trade a lower payment for years of interest that a shorter refinance would have avoided. If you would rather keep your term and pay down the balance faster instead, see the auto loan payoff calculator.
Sources
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