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- An auto loan is repaid in equal monthly payments that cover interest and part of the balance.
- A longer term lowers the payment but raises the total interest you pay.
- Your loan amount is the price plus tax and fees, minus your down payment and trade-in.
- Paying a little extra each month shortens the loan and saves interest.
How to use the auto loan calculator
Enter the price and down payment
Type the vehicle price and any cash you will pay up front. Add a trade-in value if you have one.
Set the interest rate and term
Enter the APR from your loan quote and choose the number of months.
Add tax and fees if needed
Open the advanced options to add sales tax, fees, money still owed on a trade-in and extra monthly payments.
Read the results
See the monthly payment, loan amount, total interest and the number of months to pay off.
If you need the sales tax amount first, use the Sales Tax Calculator. For loans in general, the Loan EMI Calculator works for any amount and term.
How an auto loan payment is calculated
Car loans use the standard amortization formula. Each payment is the same amount. Early payments are mostly interest, and later payments are mostly principal.
Auto loan payment formula
Loan amount = price + sales tax + fees + negative equity − down payment − trade-in
Monthly rate i = APR ÷ 12 ÷ 100
Payment = loan × i ÷ (1 − (1 + i)−n), where n is the number of months
Total interest = payment × n − loan amount
At 0% interest the payment is simply the loan amount divided by the number of months.
Auto loan examples
Example 1: a standard loan
A $35,000 car with $5,000 down, a 6.5% APR and a 60-month term.
You pay about $5,219 for the privilege of borrowing over five years.
Example 2: tax, fees and a trade-in
A $35,000 car, a $3,000 trade-in with $2,000 still owed, $2,000 down, 7% sales tax on the price minus the trade-in, $500 in fees, 6.5% APR and 60 months.
Tax, fees and old debt push the loan above the sticker price minus down payment.
Example 3: paying $100 extra a month
The loan from Example 1, with an extra $100 added to every payment.
Extra payments go straight to principal, so the loan ends ten months sooner.
How term and rate change your payment
Term comparison on a $30,000 loan at 6.5%
A longer term lowers the monthly payment but costs more in interest.
Going from 36 to 84 months cuts the payment by about $474 but adds about $4,320 in interest.
Rate comparison on a $30,000, 60-month loan
Even a few points of APR change the cost noticeably.
Shopping for a lower APR can save thousands over the life of the loan.
Where an auto loan calculator helps
Setting a car budget
Work backwards from the monthly payment you can afford to the price you can pay.
Comparing loan offers
Compare dealer financing with a bank or credit union quote on the same price and term.
Choosing a term
See how much extra interest a longer, cheaper-per-month loan really costs.
Planning extra payments
Check how much sooner you finish and how much interest you save.
The monthly payment is only part of owning a car. Insurance, fuel, maintenance and registration are extra. Lenders may also add fees or use slightly different rounding, so rely on your loan quote for the final figures. This calculator gives an estimate and is not financial advice.
Auto loan calculator FAQ
How is a monthly car payment calculated?
The payment comes from the loan amount, the monthly interest rate and the number of months, using the amortization formula. The same amount is paid each month, split between interest and principal.
How does the loan term affect the payment?
A longer term gives a lower monthly payment but a higher total interest cost. On a $30,000 loan at 6.5%, 84 months costs about $4,300 more in interest than 36 months.
Does a bigger down payment help?
Yes. It lowers the loan amount, so both the monthly payment and the total interest drop. It also reduces the chance of owing more than the car is worth.
What if I owe more on my trade-in than it is worth?
The shortfall, called negative equity, is added to the new loan. Enter it in the advanced options so the loan amount and payment include it.
Should I include sales tax in the loan?
Many buyers do, since tax is due at purchase. Use your state combined rate, and check whether your state taxes the price minus the trade-in or the full price.
What is a good APR for a car loan?
It depends on your credit score, the loan term, the lender and whether the car is new or used. Compare written quotes from a bank, a credit union and the dealer, and use this calculator to see the real cost of each.