Car Loan Early Payoff Calculator: Extra Payments
How much can I save by paying off my car loan early? Enter your remaining balance, rate and months left, then add an extra monthly payment, a one-off lump sum, or both. You see the new payoff time and the interest saved. This page starts from a loan you already have. To price a new loan, use the car payment calculator, and for a general loan schedule, use the amortization calculator.
Updated
Report a problem
Formula
Monthly interest = balance × annual rate ÷ 12. Regular payment = P × r × (1 + r)^n ÷ ((1 + r)^n − 1) with r the monthly rate and n the months left.
With extra payments, each month: new balance = balance + interest − (payment + extra). A lump sum is subtracted from the balance today. Repeat until the balance reaches zero; the last payment is smaller.
Worked example
20,000 left at 6% a year for 48 months: r = 0.005, payment 469.70, interest 2,545.63.
- Add 100 a month: paid off in 39 months (9 saved), interest 2,047.44, saving 498.19.
- Instead pay 5,000 today: paid off in 35 months (13 saved), interest 1,383.52, saving 1,162.11.
Use this when
You have spare cash or a bonus and want to know whether to put it toward the car loan. The saving is bigger the higher the rate and the more months remain, and a lump sum made early beats the same money paid late. Compare the interest saved with what the cash would earn or save elsewhere.
How it differs from nearby pages
The car payment calculator prices a new loan from a car price. The loan calculator and amortization calculator work for any loan and show a schedule, but they do not model a one-off lump sum on a car loan balance. The total cost of ownership calculator leaves out interest altogether.
Before you pay extra
Check that the lender applies the extra to principal and that the contract has no prepayment penalty. Some lenders treat extra money as an early payment of next month's instalment, which saves nothing.
Common mistakes
- Entering the original loan amount instead of today's balance.
- Entering the original term instead of the months remaining.
- Counting savings on a loan with a 0% rate, where early payoff saves no interest.
- Draining an emergency fund to pay off a low-rate loan.
Frequently asked questions
How do extra payments shorten a car loan?
Extra money goes straight to the balance, so next month's interest is charged on less. On a 20,000 loan at 6% with 48 months left, 100 extra a month pays it off in 39 months and saves about 498 in interest.
Is a lump sum better than extra monthly payments?
A lump sum made today saves interest on every later month. A 5,000 lump sum on the same loan ends it 13 months early and saves about 1,162. Smaller regular extras help too, but they reach the balance slowly.
Will my lender apply the extra to principal?
Not always. Some lenders hold extra money as an early payment of the next instalment. Ask for it to be applied to principal, and check there is no prepayment penalty in your contract.
How is the payoff time worked out?
Each month interest is balance × rate ÷ 12, then your payment plus the extra reduces the balance. The calculator repeats this until the balance is zero. The last payment is usually smaller than the others.
How much interest do I save paying 200 extra a month on a car loan?
On a 20,000 loan at 6 percent with 48 months left, 200 extra a month finishes the loan in 33 months, 15 months early, and saves 830.35 of interest. Interest falls from 2,545.63 to 1,715.28.
Is paying 2,000 once better than a small extra amount each month?
A 2,000 lump sum today on the same loan ends it 5 months early and saves 513.22 of interest. Paying 100 extra every month saves 498.19 and ends it 9 months early, so the monthly extra is nearly as good here.
How much do I save paying 50 extra on a 15,000 loan at 7%?
With 36 months left, a regular payment is 463.16 and the interest is 1,673.63. Paying 50 extra a month finishes the loan in 33 months, 3 months early, and saves 179.76 of interest.