Car loan calculator
An estimate. Dealer fees, registration, extended warranties and gap insurance are not included, and sales tax rules vary by state — some tax the trade-in, some do not.
The amount financed on a car is the price plus sales tax, less the deposit and any trade-in. That figure is then repaid as a fixed-rate instalment loan. On a $32,000 car with $4,000 down and 6% tax at 7.9% over 60 months, $29,920 is financed and the payment is $605.24, of which $196.97 is interest in the first month alone.
How to use this calculator
Dealers negotiate on the monthly payment because a longer term hides a higher price. The same $28,000 financed at 7.9% costs $566.40 a month over 60 months and $435.02 over 84, but $8,541.71 of interest instead of $5,984.00. On the default loan above, the ladder runs from $1,351.84 a month over 24 months for $2,524.07 of interest to $464.85 over 84 months for $9,127.42. Every step down the payment ladder costs roughly $1,300 more in interest, and the steps get no cheaper as they get longer. Compare the total paid, never the monthly figure alone.
Your state decides the tax base, and this page takes the cautious view
This calculator applies the sales tax rate to the full vehicle price. Many states instead tax only the difference between the price and the trade-in, and some tax the full price the way this page does. On a $32,000 car with a $10,000 trade-in at 6%, the two treatments are $600 of tax apart, and that $600 gets financed: $12.14 more a month and $128.23 more interest across five years. If your state credits the trade-in, subtract the trade-in from the price field and leave the trade-in field at zero, and the base will be right.
What the payment above leaves out
The rate you enter is a nominal rate on the amount financed, and nothing else is modelled. Documentation fees, registration, title, an extended warranty, gap insurance and dealer-installed accessories are all commonly financed alongside the car, and none of them reach this page unless you add them to the price. The Consumer Financial Protection Bureau defines the amount financed as the price of the vehicle plus taxes and other government fees, less the down payment and any trade-in, so anything the finance office adds after the price is agreed belongs in the price field before two quotes can be compared at all.
The other omission is deliberate. This page models the loan, not the car. It can tell you that $24,839.47 is still owed after twelve payments on the default 60-month loan, and $26,586.49 on the same money over 84 months. What the car is worth on those dates is a separate question with a separate answer, and the gap between the two numbers is the whole reason long terms are risky rather than merely expensive.
What people use it for
- Checking a dealer’s monthly quote against the price you actually agreed
- Seeing what stretching from 60 to 84 months adds in total interest
- Working out how much a trade-in takes off the amount financed
- Getting sales tax into the figure before signing anything
- Weighing 0% dealer finance against the cash rebate you give up for it
- Adding documentation and registration fees to the price before comparing lenders
- Finding what rounding the payment up to the next fifty removes from the term
Questions
It depends on the state. Many give credit for the trade-in and tax only the difference; some tax the full price. This calculator taxes the full price, which is the cautious assumption. On a $32,000 car with a $10,000 trade-in at 6%, the two rules are $600 apart.
Subtract the trade-in from the price field and leave the trade-in field at zero. The tax then falls on the difference, and the amount financed comes out the same as the dealer’s worksheet.
The shortest you can carry. On the default loan, 24 months costs $2,524.07 in interest and 84 months costs $9,127.42 for the same car.
About $1,300 in extra interest per step on the default loan: $3,783.36 at 36 months, $5,073.49 at 48, $6,394.33 at 60, $7,745.71 at 72, $9,127.42 at 84.
Sometimes, since it reduces the lender’s risk. It always reduces the interest, because there is less balance to charge it on.
Enter zero as the rate. The default car at 0% over 60 months is $498.67 a month and $29,920 in total, against $36,314.33 at 7.9%.
Larger than most: $5,268 on these numbers. A $2,000 rebate takes $29,920 down to $27,920, which at 7.9% over 60 months totals $33,886.90 and loses to 0% by $3,966.90. Even $5,000 is on the wrong side of the line — $24,920 financed still totals $30,245.76, losing by $325.76. The break-even is where the rebate covers the whole 21.4% that five years of interest adds to the balance, which is $5,268.
Term, not rate. Interest is $196.97 of the first $605.24 payment here, about a third, because five years of balance is a short run. The first payment on a 30-year mortgage is around 86% interest even at a much lower rate.
$24,839.47 of the original $29,920 on the default 60-month loan. Over 84 months the same money leaves $26,586.49 outstanding at the same point.
An extra $50 a month on the default loan clears it in 55 months instead of 60 and saves $609.74 of interest. Enter it in the extra field and the schedule redraws.
No. It is the nominal rate applied to the amount financed. APR folds compulsory finance charges into the rate, so a loan with an origination or acquisition fee has an APR above the rate you were quoted.
Yes, if it is being financed rather than paid separately. It is part of what the loan has to repay, and leaving it out understates both the payment and the interest.
Only if you add them to the price. Both are usually sold in the finance office after the price is agreed and both are usually financed, which is how a payment quoted at the desk grows before the paperwork is signed.
Owing more on the loan than the car would sell for. This page shows one side of that, the balance, and says nothing about resale value. Long terms make it likelier because the balance falls slowly in the early years.
Because a payment target can be met by moving the term, the rate or the price, and only one of those three is the thing you are buying. Agree the price first and treat the payment as an output.
On a normal amortising loan, yes, and you stop paying interest on the balance you retire. Check the agreement for a prepayment penalty before relying on it.
One where the interest for the whole term is worked out up front and added to the balance. Paying it off early does not remove the unearned interest automatically, so the saving is smaller than on the simple-interest loan this page models.
Use the combined rate for the address where the vehicle is registered, not where the dealer is. That is often a different figure from the state headline rate.
Get a rate from your own bank or credit union first, then let the dealer try to beat it. The comparison only works on the same amount financed and the same term, which is what the field above the result is for.
The arithmetic is identical. Sales tax is usually still due when you register the vehicle, so keep the tax field set even though no dealer is collecting it.
This calculator assumes so. Real lenders differ, and some apply an unlabelled extra payment to next month’s instalment instead. Say in writing that it is a principal reduction.
Almost always because the amount financed is larger than the one here. Add every fee and add-on to the price field, then check the financed figure against the dealer’s before looking at the rate.
Each row is one payment split into principal and interest with the balance left after it. The interest column falls every month because the balance it is charged on falls.