How to use this auto loan calculator
Enter the vehicle price, your down payment, the interest rate, and the loan term. The calculator subtracts your down payment to find the financed amount, then shows your monthly car payment and total interest.
The payment comes from the standard loan formula: payment = amount financed × r ÷ (1 − (1 + r)−n), where r is the annual rate divided by 12 and n is the number of monthly payments. Because interest is charged only on the balance still outstanding, a larger down payment lowers your monthly payment and your total interest at the same time. The same math applies to any installment debt, which is what the general loan calculator handles.
Worked example
A $35,000 car with a $5,000 down payment means you finance $30,000. At 7% over 6 years (72 months) the payment is about $512 per month, with roughly $6,800 of interest over the loan.
Shortening that same loan to 48 months raises the monthly payment but cuts the interest bill by roughly a third, since you are borrowing the money for two fewer years. Term length is usually a bigger lever on total cost than haggling over a fraction of a percentage point on the rate. Putting more down shrinks the payment fast, as the down payment calculator makes clear.
What to watch with car loans
- Longer terms (72–84 months) lower the payment but you can end up owing more than the car is worth.
- Sales tax and fees may be financed too, raising the real amount borrowed.
- A trade-in works like extra down payment — add its value to your down payment field.
Compare offers on total cost, not just the monthly payment: two deals with an identical payment can differ by thousands once the term is taken into account. Dealer add-ons such as extended warranties and gap insurance are often financed alongside the car, so they quietly accrue interest for the whole term too. These figures are an estimate for general information only and are not financial advice. Lenders also look at your debt-to-income ratio, so check that before you apply.
Frequently asked questions
- Should I include sales tax?
- If you plan to finance the tax and fees, add them to the vehicle price. Otherwise enter the price you're financing.
- Is a longer car loan a good idea?
- A longer term lowers monthly payments but increases total interest and the risk of negative equity. Shorter terms cost less overall.
- How does a trade-in affect the payment?
- A trade-in reduces the amount you finance, like a down payment. Add its value to the down payment field.
- What if I still owe money on my trade-in?
- Subtract what you owe from the trade-in value first. If the result is negative you have negative equity, which is usually rolled into the new loan, so add that shortfall to the vehicle price rather than the down payment.
- How exact is the payment shown?
- It is an estimate for general information only and not financial advice. Dealers may add documentation fees, gap insurance or a different rounding convention, so confirm the final number in your loan agreement before signing.