Personal Loan Refinance Calculator and Lender Guide

A personal loan refinance calculator estimates the monthly payment and total interest on a replacement loan using its balance, APR, and term; it does not identify or endorse a lender. Enter the new loan’s figures to compare its estimated payments with your existing loan, then confirm rates, fees, and payoff details directly with lenders.

Formula

The calculator applies the standard fixed-payment installment-loan formula. Monthly payment is the principal multiplied by the monthly interest rate, divided by one minus the monthly-rate growth factor over the full repayment term:

Payment = P × r ÷ [1 − (1 + r)⁻ⁿ]

• P is the replacement loan amount in dollars.
• r is the monthly interest rate as a decimal, calculated as APR ÷ 1,200.
• n is the number of monthly payments, calculated as years × 12.

Total interest is estimated as the monthly payment multiplied by the number of payments, minus the principal: Interest = payment × n − P. The displayed payment is rounded to cents before total interest is calculated. The formula assumes the entire entered amount is financed; if fees are rolled into the new loan, include them in the amount only when that matches the lender’s actual offer.

Worked Example

Using the calculator’s default inputs—$20,000, an 8% APR, and a five-year term—the monthly rate is 0.08 ÷ 12 = 0.0066667, and the term is 5 × 12 = 60 payments.

Payment = 20,000 × 0.0066667 ÷ [1 − (1.0066667)⁻⁶⁰] = approximately $405.53 per month.

Total interest = $405.53 × 60 − $20,000 = $4,331.80. These are estimates under the stated assumptions, not a lender’s offer. Rounding and the exact timing or treatment of payments can make a lender’s disclosed figures differ.

What a Personal Loan Refinance Means

Refinancing a personal loan generally means taking out a new loan to pay off one or more existing loans. The new loan has its own balance, APR, repayment period, payment schedule, and contract terms. The borrower’s objective may be a different monthly payment, a different term, or a change in loan structure; the calculator models only the payment and interest for the new loan’s entered amount, APR, and term.

The lender providing the replacement loan is the refinance lender. A bank, credit union, or other lender may offer personal loans, but availability and terms vary. This page does not rank providers or predict whether an application will be approved. For an actual comparison, obtain a written offer and check its APR, amount financed, payment count, fees, and payoff process.

How to Compare a Refinance Offer

Start with the existing loan’s current payoff amount, not simply its original principal or the sum of future scheduled payments. Ask the current lender for a payoff quote with an effective date, because accrued interest or other contract-specific amounts may affect what is needed to close the balance. Then use the proposed replacement loan’s amount, APR, and term as calculator inputs.

• Compare monthly payments and total interest across the full repayment period.
• Check whether an origination or other fee is charged upfront or added to the new balance.
• Confirm whether the quoted APR reflects the same amount and repayment term as the payment quote.
• Ask how and when the new lender pays off the old loan, and verify that the old account is settled.
• Read the contract for payment dates, late-payment terms, and any restrictions or charges relevant to early payoff.

A lower payment by itself does not show that a refinance costs less overall. For example, a longer term can reduce the scheduled monthly amount while increasing the number of months interest accrues. To make a like-for-like comparison, compare total remaining payments and applicable costs on the existing loan with the replacement loan’s payments and fees. Avoid counting the same fee twice: include it in the financed amount or treat it as a separate cost, according to how it is charged.

Costs, Timing, and Common Problems

The calculator excludes fees and does not model the old loan, so it cannot determine a complete savings figure on its own. If a lender adds a fee to the loan, the balance used to calculate payments may be higher than the amount sent to pay off the existing debt. If the fee is paid separately, it still affects the overall cost even though it is not part of the new principal.

Timing can also matter. Interest may accrue on the existing loan until its payoff is processed, while the replacement loan may begin accruing under its own agreement. If payment is sent late or for the wrong amount, the old balance might not be fully cleared. Follow both lenders’ instructions, keep payment records, and check that the prior account shows the expected payoff rather than assuming the transfer happened automatically.

Another common misconception is that refinancing automatically improves a credit profile or guarantees a lower APR. Neither conclusion follows from this arithmetic. A lender decides whether to make an offer and what terms to quote; the effect of an application or a new account depends on circumstances the calculator does not model. Request the actual terms and ask the lender how it handles applications and payoff before relying on an estimate.

Alternatives and Calculator Limits

Refinancing is not the only way to change a repayment plan. Depending on the existing contract and the borrower’s circumstances, possibilities to investigate may include asking the current lender about payment options, making additional principal payments, or reviewing a budget and payoff schedule. Each option has different terms and consequences; this calculator does not compare them or assess personal suitability.

The equation assumes a fixed APR, equal monthly payments, and a fully amortizing loan with monthly compounding at APR divided by 12. It does not account for variable rates, irregular payment dates, fees, insurance, taxes, missed payments, extra payments, or changes in the balance. If the loan has a promotional period or a nonstandard schedule, this estimate may not represent its payment structure. Use the lender’s disclosed schedule for exact amounts.

Frequently Asked Questions

Can I refinance a personal loan with another lender?
Some lenders offer personal loans that can be used to pay off existing debt, but eligibility and terms depend on the lender and application. Ask whether the offer allows the intended payoff and verify the exact amount and process.

Does refinancing a personal loan lower the monthly payment?
It can, depending on the new amount, APR, and term, but the calculator only estimates the payment for the inputs provided. A longer repayment term can mean more total interest even when the monthly payment is lower.

Should I use the balance or payoff amount in the calculator?
Use the amount that must actually be financed to complete the payoff, including any amount the new loan will cover. Request a dated payoff quote from the existing lender; a displayed account balance may not include all amounts needed for a particular payoff date.

Does the calculator include refinance fees?
No. It calculates payment and interest from the entered loan amount, APR, and term. Check the offer for fees, and account for them separately or include them in the loan amount if they are financed.

How do I know whether the old loan was paid off?
Follow the lenders’ payoff instructions and confirm with the existing lender that the balance has been settled. Keep confirmation and payment records, and continue to follow the old lender’s instructions until payoff is confirmed.

The result is an estimate; the lender’s disclosure gives the exact figures.

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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 | $ | p * (apr / 1200) / (1 - (1 + apr / 1200) ^ -(yrs * 12)) | 2
out int | Total interest | $ | pmt * yrs * 12 - p | 2