Calculate refinancing: old versus new
Put the remaining cost of your current financing side by side with a new loan's total cost to see the real difference.
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The calculator compares modelled annuities. For a reliable decision you need the current settlement amount and all one-off costs.
What the calculator sets against each other
Both sides are modelled with the same annuity formula. The old side is the outstanding balance, charged at the old effective rate over the remaining term. The new side is the same outstanding balance, charged at the new effective rate over the new term, plus the one-off costs. The difference shown is the old total cost minus the new total cost including one-off costs. A positive value means a saving, a negative one extra cost — and the sign often flips with just a moderate extension of the term.
The check: your real repayment
The calculator also shows the modelled old repayment. Compare it with the repayment that actually leaves your account. If the two differ significantly, your inputs for the outstanding balance, remaining term or old effective rate are not right. It is the quickest plausibility check available here — and it costs you a glance at your bank statement.
Two figures only your current lender knows
The settlement amount on a specific cut-off date and any early repayment compensation are not fixed in advance in any contract. Ask your current lender for both in writing before you sign. The compensation is not arbitrary: for general consumer loans (Allgemein-Verbraucherdarlehen), § 502 Abs. 3 BGB caps it at 1 % of the amount repaid early — 0.5 % if the remaining term is no more than one year — and in no case at more than the borrowing interest for that period. Enter the amount you are quoted in the one-off costs field.
- Request the settlement amount for the cut-off date
- Ask for the early repayment compensation in writing
- Enter both under one-off costs
- Only give notice once the new loan approval is in place
A lower repayment is not the same as cheaper
Refinancing reliably lowers the monthly repayment if the new term is longer — even if the interest rate stays the same or rises. The total amount moves in the other direction. So first set the new term to the old remaining term and see what the interest rate alone achieves. Only then does it make sense to play with the term — and then you know which part of the relief will cost you something later.
Frequently asked questions
Which remaining term should I use in the refinancing calculator?
Enter the term still remaining on your existing loan, not its original total term. Use a current outstanding balance or settlement statement for this. Outdated starting values can significantly distort the saving shown.
What does the saving shown in the refinancing calculator mean?
It is the difference between the modelled remaining cost of the existing loan and the modelled total cost of the new loan. It is therefore a calculated value based on your inputs, not a guaranteed benefit. You also need to take one-off costs such as settlement fees or early repayment compensation (Vorfälligkeitsentschädigung) into account.
Which figures do I need for the comparison?
You need the outstanding balance or settlement amount, the remaining term and the current repayment of the existing loan, as well as the effective rate and term of the new offer. Your lender provides the figures for the current loan in a settlement statement (Ablösebescheinigung). Without these figures the comparison remains a rough estimate.
Why does the repayment fall even though refinancing becomes more expensive?
The repayment and the total cost are different quantities. A longer term spreads the same debt over more months and so lowers the repayment, but it extends the interest payments. Whether that makes sense depends on whether you deliberately want to gain liquidity or reduce the total cost.
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Your next steps
Refinancing
Check refinancing: set the outstanding balance, settlement costs and the remaining cost of the old loan against the total cost of the new one.
Read moreEarly repayment compensation
For an instalment loan, early repayment compensation is capped at 1 per cent, or 0.5 per cent if little of the term remains – and sometimes it does not apply at all.
Read moreEarly repayment
An instalment loan may be paid off in full or in part at any time – and the interest and costs for the remaining term fall away.
Read moreComparison
First determine the settlement amount and remaining costs, then compare new loan offers with an identical financing amount and the same term.
Read more