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WPCalc Wise People Calculate

Refinance Interest Savings Calculator

This calculator helps you calculate the savings on interest after refinancing your loan. By comparing the old and new loan terms, it shows how much you can save by refinancing your loan with a lower interest rate or a modified term.

Calculate Your Refinancing Interest Savings

Input Fields
P
$
Enter the current loan amount
r_old
%
Enter the current interest rate on your loan
n_old
Enter the current loan term in months
r_new
%
Enter the new interest rate after refinancing
n_new
Enter the new loan term in months
If enabled, the result will update automatically when you change any value.

Refinance Interest Savings Formula

Formula
$$PMT_{\text{old}} = \frac{P \times r_{\text{old}}}{1 – (1 + r_{\text{old}})^{-n_{\text{old}}}}$$ $$PMT_{\text{new}} = \frac{P \times r_{\text{new}}}{1 – (1 + r_{\text{new}})^{-n_{\text{new}}}}$$ $$\text{Savings} = (PMT_{\text{old}} – PMT_{\text{new}}) \times n_{\text{new}}$$

Where:

  • Old Monthly Payment – monthly payment on the original loan
  • Old Loan Term – number of months left on the original loan
  • New Monthly Payment – monthly payment after refinancing
  • New Loan Term – number of months for the new refinanced loan

This formula calculates the difference between what you would have paid on the original loan and what you will pay on the refinanced loan.


Refinancing a loan can help reduce your monthly payment or shorten the term, leading to interest savings over the life of the loan. This calculator allows you to compare your old loan terms with the new ones to see how much interest you could save by refinancing. It’s useful for mortgage, car loan, and personal loan refinancing.

By refinancing at a lower interest rate or adjusting your loan term, you can potentially save significant amounts in interest payments, making it a valuable tool for financial planning.

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