Car Loan Refinancing — 11% to 6%
Refinancing from 11% to 6% — what you actually save
Monthly savings by loan balance
| Loan Balance | Old payment (11%) | New payment (6%) | Monthly savings | Total savings (60mo) |
|---|---|---|---|---|
| $10,000 | $217 | $193 | $24/mo | $1,446 |
| $15,000 | $326 | $290 | $36/mo | $2,169 |
| $20,000 | $435 | $387 | $48/mo | $2,892 |
| $25,000 | $544 | $483 | $60/mo | $3,614 |
| $30,000 | $652 | $580 | $72/mo | $4,337 |
| $35,000 | $761 | $677 | $84/mo | $5,060 |
| $40,000 | $870 | $773 | $96/mo | $5,783 |
60-month remaining term assumed. Actual savings depend on your balance and remaining months.
Is a 5% rate drop worth the paperwork?
At 5%, this is a refinance worth doing. Most lenders charge no fees on auto refinancing. Free application, 24-hour approval, and $60 back in your pocket every month. The only reason not to: if you are within 12 months of paying the loan off.
Who this refinance actually makes sense for
5 points from 11% to 6% is achievable for buyers whose credit has moved from subprime to prime in the 18-24 months since purchase. Consistent payment history is the single most reliable driver of score improvement at the subprime-to-prime boundary.
The breakeven on a refinance at this rate drop is typically 2-4 months. After that you are saving real money every month for the life of the loan.
Experian data: the average credit score improvement after 24 months of on-time auto loan payments is 22 points. For subprime borrowers the improvement is often higher because the installment mix effect is larger at lower starting scores.
Run your numbers
See your full Ownership Score with the new rate
Frequently Asked Questions — 11% to 6%
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