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Using this car loan refinance calculator will enable you to:
See how much money you could save by refinancing your current auto loan
View your new monthly car loan payment after refinancing
See how the loan length affects your monthly payment
Compare auto refinance loan offers to find the one that’s best for you
See more information below on how to use this car refinance calculator.
Why refinance your car loan?
Maybe you’d like to lower your monthly car payment. Perhaps your credit score has improved. Or maybe you think the dealer marked up your interest rate when you bought your car. Depending on the terms of your original loan or changes in your finances, auto refinancing might save you money on interest or reduce your monthly car payment.
Gather key information about your current loan
To use this auto loan refinance calculator most effectively, you'll need several details about your current loan. You can easily find the information on your latest car loan statement or by calling your lender. If all else fails, estimate the information for a quick approximation of the results.
Enter information about your current car loan in the calculator's Current Loan section. Then complete information about the loan you're considering in the New Loan section. Select the calculate button to see your results.
Current car loan information you will need
Original loan amount: This is the total amount of money you borrowed. If you bought a new car and made a down payment, it's the purchase price of the car minus the amount you put down.
Current interest rate: This is the interest rate you qualified for at the beginning of your loan. If you financed through a car dealer, you might be paying a higher rate than you deserve. This often happens to people who don’t get preapproved for a loan or those with below average credit, mainly because they are unaware that better rates are available.
Length of current loan: This is the number of months in the loan when you began paying it off. For new cars, most people take out 60-month loans.
Balance of current loan: Hopefully, you’ve been making payments on time each month. If you’ve had the loan for a year or more, your current balance is well below what you borrowed. If you don’t know how much you still owe, look at your latest statement or call your lender and ask for the "payoff amount."
Months left on current loan: This is the amount of time remaining on your original loan. It’s hard to refinance at a better rate without a history of regular, on-time payments for at least six to 12 months. However, the more time you have left on your loan, the more you could save by refinancing.
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Input new refinanced car loan information
Refinanced loan amount: If you don’t know how much you still owe on your existing loan, look at your latest statement or call your lender and ask for the "payoff amount." You may owe more than your car is worth; most lenders will refinance amounts greater than a car's book value.
New loan term: One advantage of refinancing is that you can change the amount of time to pay off the car loan. If you want to pay off your loan more quickly, select fewer months than you now have remaining. This will mean you’ll pay less in interest. If you want to lower your monthly car payment and don’t mind paying more for interest, you can extend the loan for an extra six or more months. But be careful when extending your auto loan — you could end up owing more than the car is worth, since cars depreciate quickly.
New interest rate: If your credit has improved or interest rates have dropped, you might be able to refinance your car loan at a lower interest rate. If you’re just testing the waters and don’t know if you want to move forward, you can guess what interest rate you might get. If you’re serious about refinancing and want exact figures, apply to multiple lenders first. Then, once you get a quote, enter that interest rate here.
Note that when you refinance, you may have the option of taking cash out of your loan. In most cases, there isn’t much equity in a car loan, so taking cash out might increase the risk of being “upside down” on the loan — owing more than the car is worth. NerdWallet recommends that you don't take cash out unless you made a large down payment and suddenly need money for an emergency.
Reviewing the results
If you qualify for a lower interest rate and keep the same loan term, you'll get a lower monthly payment. In some cases, the monthly payment won’t seem to drop very much. However, take a look at the total amount you’d save in interest. Over time it may add up to a lot.
Auto loans usually don't have prepayment penalties, and most lenders don’t charge application or origination fees, though there may be other relatively small fees associated with transferring your loan. If auto loan refinancing would save you money or take the strain off your finances, it could be worth it.
Most banks and credit unions offer loans for auto refinancing as do many online lenders. NerdWallet provides a list of lenders that will refinance a car loan. Some of the companies are aggregators that send your loan application to a number of lenders. This makes it easy to compare interest rates and terms from multiple lenders, an essential step in finding the best new loan.