Vehicle EconomicsAuto Loan Refinance Calculator
Compare keeping your current loan against a proposed refinance on payment and total cost.
Why this comes up
Rates drop, credit improves, or a promotional offer shows up, and suddenly refinancing looks tempting. But a refinance almost always resets the clock on your loan, and a lower payment from a longer term can quietly cost more overall even at a better rate. This engine compares both dimensions instead of just the one a lender likely leads with.
How we calculated this
We compare your existing loan's remaining payment and interest against the proposed refinance's payment and interest, with its fee either paid in cash or financed into the new principal.
Worked example, using this page's own defaults ($18,000 balance at 9% moving to 5% APR, both 48-month terms, $300 fee paid in cash): the lower rate wins on both payment and total cost here, run the calculator above to test your own offer.
What this means
- Watch for a refinance that resets or extends your term, that's the scenario where a lower payment can hide a higher total cost.
- If two competing offers are on the table, Lower Payment vs Lower APR Refinance names which wins on each dimension separately.
- Once you know the recommendation, Auto Refinance Break-Even Calculator tells you how long it takes the fees to pay for themselves if you're not sure you'll keep the loan.
Limitations
No credit-impact, lender underwriting, or prepayment-penalty model is included. See Methodology.
Methodology
This engine is built on Vehicle Economics' fixed-rate amortization model: the standard loan-payment formula run out as a full month-by-month schedule. See Methodology for the full detail.