Auto Loan Calculator

Estimate your monthly car payment, total interest, and full cost of your auto loan.

Monthly Payment
Quick Answer

Subtract your down payment and trade-in from the vehicle price, add sales tax, then apply the loan formula: payment = principal × [r(1+r)^n] ÷ [(1+r)^n − 1]. Example: a $30,000 car at 6% APR for 60 months = $580/month, $34,799 total.

How to use this auto loan calculator

Enter the vehicle price, your down payment, any trade-in value, local sales tax, the interest rate your lender quoted, and the loan term. The calculator shows your monthly payment, total interest paid, and a year-by-year breakdown of the loan.

How car payments are calculated

Your monthly payment is determined by the loan amount (price minus down payment and trade-in, plus any taxes and fees), the interest rate, and the number of monthly payments. A higher down payment, lower rate, or shorter term all reduce what you pay. This calculator uses the standard amortization formula used by banks and dealerships.

Choosing the right loan term

A 60-month (5-year) loan is the most common. Shorter terms (36 or 48 months) mean higher monthly payments but significantly less total interest. Longer terms (72 or 84 months) reduce monthly payments but can cost thousands more in interest, and often leave you owing more than the car is worth in the early years.

What's a good auto loan rate?

Rates depend heavily on your credit score. Buyers with excellent credit (720+) typically see rates of 5-7% on new cars. Good credit (660-719) typically qualifies for 7-10%. Used car loans generally run 1-2% higher than new car rates. Credit unions often offer lower rates than dealership financing, so it's worth comparing before you sign.

Down payment and trade-in

A larger down payment reduces the amount you borrow and therefore the total interest you pay. A common guideline is 20% down on a new car. A trade-in works the same way: its value is deducted from the purchase price, reducing your loan principal. Always negotiate the vehicle price and trade-in value separately from your financing terms.

Frequently asked questions

How is a car payment calculated?

Your monthly payment is based on the loan amount, the annual interest rate, and the loan term in months. The formula is M = P[r(1+r)^n] / [(1+r)^n - 1], where P is the loan amount, r is the monthly interest rate, and n is the number of payments.

What is a good interest rate for a car loan?

Buyers with excellent credit (720+) typically qualify for rates of 5-7% on new cars. Average credit (660-719) typically sees 7-10%. Used car rates are generally 1-2% higher. Always shop at least two or three lenders before accepting dealership financing.

How long should a car loan be?

Most financial advisors recommend 48-60 months for new cars and 36-48 months for used. Longer loans lower the monthly payment but increase total interest paid and raise the risk of being underwater on the loan.

Should I put a down payment on a car?

Yes. A larger down payment reduces your loan amount, lowers your monthly payment, and reduces total interest. The common guideline is 20% down on a new car. It also reduces the risk of being upside-down on the loan if the car depreciates quickly.

What is the difference between APR and interest rate on a car loan?

The interest rate is the cost of borrowing the principal. APR includes the interest rate plus any fees expressed as a yearly rate. APR gives a more complete picture of the true loan cost. Always compare APRs when evaluating loan offers.