Personal Loan Refinance Calculator and Options

This personal loan refinance calculator estimates the monthly payment and total interest on a replacement loan from its amount, APR, and term. Enter the proposed loan’s figures to see an amortizing-payment estimate and compare it with the existing loan using the same method.

Formula

The calculator uses the standard fixed-payment amortization formula. It first converts the annual percentage rate (APR) to a monthly rate and the term in years to a number of monthly payments.

Monthly payment: M = round(P × r / [1 − (1 + r)⁻ⁿ], 2)

Total interest estimate: I = M × n − P

• P is the replacement loan amount in dollars.
• APR is the annual percentage rate entered as a percent.
• r is the monthly rate, APR ÷ 1200.
• y is the loan term in years; n is the number of payments, y × 12.
• M is the monthly payment in dollars, rounded to cents.
• I is estimated total interest in dollars, calculated using the rounded payment.

The formula assumes equal payments at regular monthly intervals. The APR and term are inputs, not quotes: use figures supplied for the particular refinance offer when making an estimate.

Worked Example

Using the calculator’s default inputs: P = $20,000, APR = 8%, and y = 5 years.

1. Convert the APR to a monthly rate: r = 8 ÷ 1200 = 0.0066667.
2. Convert the term to months: n = 5 × 12 = 60.
3. Apply the payment formula: M = round[20,000 × 0.0066667 ÷ (1 − (1.0066667)⁻⁶⁰), 2] = $405.53 per month.
4. Use the rounded payment to estimate interest: I = $405.53 × 60 − $20,000 = $4,331.80.

This is an illustration of the formula, not an offer or a prediction of approval. The calculator treats the entered amount as the full principal and does not add any charges to it.

Assumptions

• The interest rate is fixed for the full term.
• Payments are made monthly, at the end of each payment period.
• Interest compounds monthly at APR ÷ 12.
• The estimate excludes fees, taxes, insurance, and other costs; it also does not model late or extra payments.

Personal Loan Refinance Options

Refinancing a personal loan means replacing an existing balance with a new loan, commonly with a new APR, repayment term, or monthly payment. The replacement lender may pay the old lender directly, or the borrower may receive funds and use them to settle the balance; the process depends on the lender. The amount needed to close the old loan may differ from the balance shown on a recent statement because interest can accrue between statement dates and a payoff quote may include other amounts.

Options generally differ by how the new loan is structured:

• New fixed-rate installment loan: A set payment schedule can make the monthly amount predictable. Compare the APR, term, amount financed, and total repayment rather than focusing on the payment alone.
• Different repayment term: A longer term can reduce the scheduled payment while increasing the number of payments and potentially the total interest. A shorter term can raise the monthly payment while reducing the time interest accrues, assuming the same balance and rate.
• Refinance for a different amount: A replacement loan might cover only the payoff balance or include additional borrowing if the lender permits it. Borrowing more increases the principal to repay.
• Rate or payment change: A new APR can alter both payment and interest, but fees and the new term affect the comparison too. Do not infer savings from a lower payment alone.

How to Compare a Refinance

For a meaningful comparison, gather the existing loan’s current payoff amount, remaining term, APR, monthly payment, and any applicable payoff or account charges. Request the proposed loan’s written APR, amount financed, term, payment schedule, and itemized fees from the lender. APR is designed to reflect certain borrowing costs, but the exact items included can vary; read the disclosure rather than assuming every cost is captured in the same way.

Calculate the remaining scheduled payments on the current loan, then compare them with the replacement loan’s payments and costs over the same relevant period. Include fees paid upfront or financed into the new balance. If the new loan extends repayment, compare the total cost over the full terms and note that the old loan might otherwise have been paid off sooner. This calculator estimates only the replacement loan’s payment and interest from the inputs; it does not calculate the old loan’s payoff or determine savings automatically.

For example, a lower new monthly payment can result simply from spreading repayment over more months. If a borrower owes $10,000, a longer term can make each installment smaller, but additional months may mean more interest overall. Conversely, a higher payment under a shorter term is not by itself evidence of a higher total cost. Compare the complete schedules, not one number.

Costs, Eligibility, and Common Problems

Potential costs and conditions vary by offer. Ask how any origination or other fee is charged, whether it is deducted from proceeds or added to the amount owed, whether the displayed payment includes all required charges, and whether the loan has terms that affect early repayment. A fee deducted from proceeds can leave less cash available to pay off the old loan; a fee added to principal can increase interest because the borrower owes more.

Approval, offered APR, and loan amount depend on the lender’s assessment and the application. No calculator can determine eligibility or guarantee terms. Avoid submitting an application until you understand whether the lender’s process involves a credit inquiry and what information it requests. Use secure application channels, verify the lender independently, and do not pay an unexpected upfront charge or share account passwords in response to an unsolicited message.

A common complication is a gap between the refinance funding date and the old loan’s payoff date. Confirm who will send the payoff, keep making required payments until the old account is shown as paid, and check that the account closes with the expected balance. Otherwise, a missed or delayed payment could create extra interest or other account consequences. Contact both institutions if amounts or dates do not match the written disclosures.

Frequently Asked Questions

Does refinancing a personal loan lower the monthly payment?
A new payment may be lower if the APR, principal, or term changes, but a longer term can increase total interest. Compare the complete payment schedule and costs.

Can I refinance a personal loan with the same lender?
Some lenders may consider a new loan for an existing customer; others may not offer that option. Ask the lender directly about its current process and terms.

Does refinancing pay off my old personal loan automatically?
It depends on the lender’s process. Confirm whether funds go directly to the old lender or are sent to you, and verify the old balance is paid after funding.

What loan amount should I enter?
For an estimate, use the proposed replacement principal, including any costs that will be financed. Obtain the old loan’s payoff figure separately; a statement balance may not be the exact amount required to close it.

Does this calculator show whether refinancing saves money?
No. It estimates the new loan’s payment and interest only. Compare those figures with the remaining costs of the current loan and include fees and timing.

Why might the lender’s payment differ from this estimate?
The lender may use a different funded amount, exact APR, payment date, fee treatment, or rounding method. The calculator assumes a fixed rate and regular monthly payments. The result is an estimate; the lender’s disclosure gives the exact figures.

Related

• Loan Depot Refinance Rates: Calculate Your Payment
• LendingTree Refinance Loan Calculator and Costs
• Loan Calculator for Refinance Payments and Interest

in p | Loan amount | $ | 20000 | 1 | 100000000
in apr | Interest rate (APR) | % | 8 | 0.01 | 100
in yrs | Loan term | years | 5 | 0.0833 | 50
out pmt | Monthly payment | $ | round(p * (apr / 1200) / (1 - (1 + apr / 1200) ^ -(yrs * 12)), 2) | 2
out int | Total interest | $ | pmt * yrs * 12 - p | 2