Tool · Refinancing

Does refinancing help?

A lower payment is not the same as a cheaper loan. Enter what you owe today and the new offer. See the cost of each path from today forward, how far the payoff date moves, when you break even, and what happens if you refinance but keep paying what you pay now.

Reviewed 5 September 2026 · Method: refinancing break-even · Example values are fictional

Result

Current: $17,289.14 at 18%, $507.87 a month. New offer: 10% for 60 months.

Refinance and keep paying $507.87: saves about $3,959.32.The new rate does the saving; the longer term does not. Paid off in 41 months, against 48 months today.

Keep current loan

18% · $507.87 a month

Monthly payment: $507.87
Paid off in: 48 months
Cost from today: $7,088.51

+$3,959.32 more

Refinance

10% · 60 mo · no fee

Monthly payment: $367.34
Paid off in: 60 months
Cost from today: $4,751.45

+$1,622.26 more

Ahead from day one

Refinance, keep your payment

10% · $507.87 a month

Monthly payment: $507.87
Paid off in: 41 months
Cost from today: $3,129.19

Lowest cost

Ahead from day one

Refinancing saves about $2,337.06 over the life of the loan. It lowers your payment by $140.53 and adds 12 months to your payoff. If you keep paying your current $507.87 on the new loan, it is paid off in 41 months and saves $3,959.32.

Line	Keep current loan18% · $507.87 a month	Refinance10% · 60 mo · no fee	Refinance, keep your paymentLowest cost10% · $507.87 a month
Amount financed	$17,289.14	$17,289.14	$17,289.14
Fees and penalty	$0.00	$0.00	$0.00
Interest rate	18%	10%	10%
Estimated APR	—	10.00%	10.00%
Monthly payment	$507.87	$367.34	$507.87
Months to payoff	48	60	41
Payoff date	as scheduled	12 months later	7 months sooner
Total of remaining payments	$24,377.65	$22,040.59	$20,418.33
Total interest from today	$7,088.51	$4,751.45	$3,129.19
Break-even	—	from day one	from day one
Total cost from today	$7,088.51	$4,751.45	$3,129.19

Cost from today, month by month

Keep current loanRefinanceRefinance, keep your payment

Show the math

Keep current loan
  Balance today        = $17,289.14
  Monthly rate r       = 18% ÷ 12 = 1.5%
  Month 1 interest     = $17,289.14 × r = $259.34; principal = $507.87 − interest = $248.53
  Paying $507.87 a month clears the balance in 48 months (last payment $507.76)
  Total of payments    = $24,377.65;  interest = $7,088.51;  cost from today = $7,088.51

Refinance: 10% for 60 months
  Payoff needed        = balance $17,289.14 + penalty $0.00 = $17,289.14
  Amount financed      = $17,289.14 (no fee)
  Monthly rate r       = 10% ÷ 12 = 0.833333%
  Payment              = amount × r × (1+r)^n ÷ ((1+r)^n − 1) = $17,289.14 × 0.00833333 × 1.645309 ÷ 0.645309 = $367.34
  Total of payments    = 367.3431 × 60 = $22,040.59
  Cost from today      = $22,040.59 − $17,289.14 = $4,751.45  (interest $4,751.45 + fees and penalty $0.00)
  Estimated APR        = the annual rate at which 60 payments of $367.34 are worth $17,289.14 today = 10.00%
  Difference           = $4,751.45 − $7,088.51 = −$2,337.06
  Break-even           = first month where cost so far under the new loan is at or below the old loan and stays there: from day one

Refinance, keep paying $507.87
  Same $17,289.14 at 10%, paid at $507.87 a month, clears in 41 months
  Total of payments    = $20,418.33;  cost from today = $3,129.19;  versus keeping the old loan: −$3,959.32

Cost so far after m payments = payments made + balance still owed − balance today. Fees on the old loan were paid long ago and are ignored on both sides.

Questions to ask your lenders

Current lender: what is my exact payoff amount as of today, how much interest accrues per day, and is there any prepayment penalty? I used $17,289.14 and no penalty.
New lender: what APR is on the Truth in Lending disclosure, and does it include every fee? I estimate about 10.00%.
New lender: can I get the same 10% rate on a 48-month term, so my payoff date does not move?
New lender: is this loan simple interest with no prepayment penalty, so that paying $507.87 a month instead of $367.34 goes straight to principal?
New lender: does the rate depend on autopay or on opening an account, and what happens if I cancel?

Assumptions and limits

Your balance today is the payoff amount. Accrued interest between statements, late fees and escrow are not included unless you add them to the balance.
Both loans charge simple interest monthly on the remaining balance, with every payment on time and in full.
Fees you already paid on your current loan are sunk and ignored on both sides. Only future money counts.
Estimated APR comes from a regular-period cash-flow calculation on the terms you entered. The lender's disclosure is the authoritative figure.
This is an offer you typed in. We do not know whether any lender would approve you for it, and we do not recommend one.

Learn more

Weighing more than one new offer? Compare them on the same cash in hand. Not sure how far along your loan is? See where your payments went. Several debts? Consolidate or pay faster.