Auto Loan Refinance Calculator
Calculate how much you may be able to save by refinancing your current auto loan.
Current loan
- Pay $0.00 more each month
- Spend $0.00 more over the lifetime of the loan
Auto loan refinance calculator: Find potential savings
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Auto refinancing involves replacing your original auto loan with a new one. In many cases, refinancing a car can lower your monthly payment and reduce your total loan cost, sometimes by thousands of dollars. Our auto refinance calculator is a tool to help you compare loans and determine how much you could save through refinancing.
Steps for using the auto loan refinance calculator
1. Enter your current auto loan details
What you need: Information about the car loan you have now, specifically the remaining balance, interest rate and monthly payment amount.
Where to find it: On your latest car loan statement, by calling your lender or through your online account with the lender.
2. Input the auto refinance loan term
What you need: The length of the new loan (how long you will have to pay it off). Auto refinance loans generally have terms from 12 to 96 months, but the actual range varies by lender.
Where to find it: You may not have an exact figure for the loan term, especially if you’re still deciding whether to refinance your car. The auto loan refinance calculator enables you to try different term and rate scenarios. Here are some ideas.
Use the amount of time remaining on your current loan as your term. See if a lower rate will reduce your monthly payment enough to make refinancing worthwhile.
Use a shorter term and lower rate to see how it affects your monthly payment. If the result is a higher payment (due to the shorter term), can you manage the increase? The benefit is paying off your loan sooner and saving on total interest.
Use a longer loan term, to see how much it will lower your payment but increase your total interest cost. The goal here is to make a too-high payment more manageable.
3. Enter the auto refinance loan interest rate
What you need: The APR of the new auto loan that will replace your current loan.
Where to find it: Again, you may not have an exact APR at this point, and the final rate you receive will depend on factors like your credit score, the lender you choose and the loan term. But here are suggestions for finding rate estimates to use in the calculator.
Apply to prequalify or get preapproved with several auto refinancing lenders, to get an idea of the rates you may qualify for. This isn’t final loan approval, but it’s a good way to see if you will qualify and at what interest rate.
Check auto refinance lender rates online to get a general idea of the current market’s rates.
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Some lenders use the terms "auto loan prequalification" and "preapproval" interchangeably, but usually prequalification is based on a soft credit inquiry, which won’t affect your credit scores. Preapproval often uses a hard credit inquiry, which can temporarily lower your credit scores. When applying to more than one lender to compare loan rates, determine if they will use a hard credit inquiry. If so, submit all applications within a 14-day period, so credit inquiries are treated as one and have less effect on your credit scores.
Reasons to refinance an auto loan
Here are some situations when it would make sense to look into auto refinancing.
Interest rates have dropped. If auto loan rates in general fall below the rate on your current car loan, refinancing could be an opportunity to take advantage of lower auto refinance rates.
Your credit has improved. If you had poor credit when you got your car loan, you may have a high interest rate. You might now qualify for a lower interest rate if you’ve made consistent, on-time payments for six to 12 months. You can check your credit report and score for free through NerdWallet.
You didn’t shop rates and took dealer financing. When you got your original loan, the dealership might have charged you a higher interest rate than you could have qualified for elsewhere — especially if it knew you weren’t comparing loan offers. But with refinancing, you can still shop for a lower rate.
Your current payment is too much. Refinancing for a longer term can reduce your monthly payment; however, you will pay more interest over the life of the loan and you could become upside-down on your car loan, which means you owe more than your car is worth. Still, a longer term may be a better option than missing payments or facing repossession.
Auto refinance calculator next steps
If you decide to move forward and apply for auto loan refinancing, the process is much like when you applied for your original car loan. Most lenders have online auto refinancing applications that return prequalified offers or conditional approval in minutes.
At some point, you’re likely to need the following information, so you can prepare by gathering it ahead of time.
Your driver’s license.
Vehicle registration.
Proof of insurance.
The vehicle identification number, or VIN, of your car.
Pay stubs from your current employer or proof of employment.
Your Social Security number.
A statement of loan payoff amount from your current lender.
Regardless of where you apply, it’s a good idea to get offers from more than one lender to find your best auto refinance rate. And keep in mind that factors unique to you, including your car’s age and mileage, contribute to the interest rate you’ll receive. So, your actual savings could be more or less than what the auto loan refinance calculator shows.