Net lifetime difference
$1,165
Net lifetime savings after fees
Example calculation
Yes, refinancing pays
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Monthly payment change
-$31/mo
current vs new
Fee break-even
Month 3
title & lender fees
Matched-term refi
$564/mo
at current remaining monthsSide-by-side breakdown
| Metric | Keep current loan | Refinance loan |
|---|
Sensitivity to refinance APR
How your monthly payment and total net savings change across candidate refinance rates:
| Refi APR | New payment | Monthly savings | Net total savings | Break-even |
|---|
Frequently asked questions
When does refinancing a car loan make financial sense?
Refinancing a car loan pays off when your credit score has improved, market rates have dropped, or a dealership marked up your original rate by 1.5 percentage points or more, and you keep the new loan term equal to or shorter than your remaining months.
Why can a lower monthly payment still cost more overall?
If you have 36 months left on your car loan and refinance into a new 60-month loan, your monthly payment drops because principal is spread over two extra years. However, paying interest for 24 additional months often outweighs a small APR reduction and keeps you underwater longer.
How much does it cost to refinance an auto loan?
Unlike mortgages, auto loan refinancing has low upfront costs. Most credit unions and online lenders charge $0 to $100 in origination fees, plus state DMV title or lien-transfer fees of $15 to $100.
Can I refinance if I owe more than my car is worth?
Many credit unions allow loan-to-value ratios up to 110% or 120% of the vehicle's clean retail value. If you are deeper underwater, paying down a lump sum before refinancing can unlock lower APR tiers.
Benchmark sources and dates
Starting assumptions are example benchmarks, not binding quotes. Change any input to match your own bills or offers.
| Assumption / Input | Starting value | Source | Checked |
|---|---|---|---|
| Remaining auto loan balance | $22,000 | Experian State of the Automotive Finance Market | 2026-10-12 |
| Current auto loan rate | 8.9% | Federal Reserve G.19 Consumer Credit Release | 2026-10-12 |
| New refinance auto loan rate | 5.9% | National Credit Union Administration Credit Union and Bank Rates | 2026-10-12 |
| Title, lien, and lender fees | $150 | Consumer Financial Protection Bureau Auto Loans | 2026-10-12 |