Auto Loan Calculator
Estimate your car payment, total interest and amortization schedule for any vehicle price, down payment and term.
Auto Loan Calculator — input your values
What does this financial calculator do?
This auto loan calculator works out your monthly car payment from the vehicle price, down payment, trade-in value, sales tax, fees, rate and term. Every cost of getting the car on the road is folded into the loan amount.
You also see the total interest, the total cost of the vehicle including the down payment, and a month-by-month amortization schedule. Changing the term shows the classic trade-off: a shorter term means a higher payment but far less interest.
Formula and variables
Sales tax is applied to the price minus the trade-in value, then added to the loan.
| Symbol | Meaning |
|---|---|
| P | Loan amount (price − down − trade-in + tax + fees) |
| r | Monthly interest rate (annual rate ÷ 12) |
| n | Number of monthly payments |
| M | Monthly payment |
Worked example
A $35,000 car with $5,000 down, a $3,000 trade-in, 7% sales tax, $500 in fees, at 6.5% for 60 months.
- Sales tax: 7% × ($35,000 − $3,000) = $2,240.
- Loan amount: $35,000 − $5,000 − $3,000 + $2,240 + $500 = $29,740.
- Monthly rate: 6.5% ÷ 12 ≈ 0.5417%.
- Monthly payment ≈ $582.01.
- Total interest ≈ $5,181.
Answer: Monthly payment ≈ $582.01 for 60 months.
Tips and common mistakes
Tips
- Longer terms (72 to 84 months) lower the payment but add thousands in interest — and can leave you owing more than the car is worth.
- A larger down payment shrinks the loan and may secure a better rate.
- Negotiate the out-the-door price before discussing monthly payments — dealers can hide costs in the payment.
- Get pre-approved by a bank or credit union to compare against dealer financing.
Common mistakes to avoid
- Financing sales tax and fees without including them when comparing offers.
- Choosing a term so long that the car depreciates faster than the loan is repaid.
- Focusing only on the monthly payment while ignoring total interest and the total cost of the vehicle.
Auto Loan Calculator — frequently asked questions
How much car can I afford?
A common guideline is keeping the total monthly car payment under 10% of your gross income, with all car costs (insurance, fuel, maintenance) under 15% to 20%.
Should I choose a shorter or longer loan term?
Shorter terms have higher payments but much lower total interest. A 36-month loan on the example above saves thousands versus an 84-month term, at the cost of a larger monthly payment.
Is my trade-in value part of the down payment?
Effectively yes — the dealer applies its value to the purchase price, reducing the amount you finance. Get quotes from a few sources to check the valuation is fair.
Why does sales tax differ between states?
Tax rates and rules vary by state: some tax the full price, others subtract the trade-in, and a few cap the amount. Check your state's rule for an accurate estimate.
What happens if I pay the loan off early?
Simple-interest auto loans charge interest only on the remaining balance, so early payoff stops future interest — with no penalty at most lenders.
Is dealer financing cheaper than a bank loan?
Not always. Dealers sometimes offer subsidized rates on new models, but bank or credit union rates can beat dealer offers elsewhere. Compare the APR on both before deciding.