See how paying a little extra each month shortens your car loan. Enter your balance, rate, and remaining term, then add an extra payment to find out how many months and how much interest you save.
First we find your scheduled monthly payment from the balance, rate, and months remaining using the amortizing loan formula: M = P × [r(1+r)n] / [(1+r)n − 1]. Then we simulate the loan month by month while adding your extra payment to the principal. Because interest is charged on the remaining balance, every extra dollar that goes to principal reduces future interest, so the loan ends sooner and you pay less interest overall.
Yes. Extra payments go straight to principal, which lowers the balance that interest is charged on. That shortens the loan and reduces the total interest you pay. The earlier in the loan you start, the bigger the savings.
If your auto loan rate is higher than what you could reliably earn elsewhere, paying down the loan is a guaranteed return equal to your rate. If you carry higher-interest debt like a credit card, pay that first.
Usually, but not always automatically. Some lenders apply extra to future payments or interest unless you specify principal-only. Check with your lender and label extra payments as principal reduction.
Most US auto loans have no prepayment penalty, but a few do. Review your loan agreement before making large extra payments to confirm there is no early-payoff fee.
The month-by-month amortization is exact for a fixed-rate loan. Your real result can differ slightly based on how your lender posts payments, daily-interest accrual, and fees.
Disclaimer: This tool provides an estimate for general informational purposes only and is not financial advice. Loan rates, terms, and payment posting rules vary by lender. Consult your loan agreement and a licensed professional before making decisions.