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Auto Loan Calculator

Calculate monthly car payments, total interest, and view amortization schedules. Factor in trade-in, down payment, taxes, and fees.

Auto Loan Worksheet
Vehicle & loan details
$
%
Down payment & trade-in
$
$
$
$
Fees & taxes
%
$
Monthly payment $834.11
Loan amount$44,200.00
Sales tax$2,000.00
Upfront payment$10,000.00
Total payments$50,046.52
Total interest$5,846.52
Total cost$60,046.52

Loan Breakdown

Principal Interest Tax Fees

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How Auto Loans Work

An auto loan is a secured loan using the vehicle as collateral. You borrow the purchase price minus your down payment and trade-in equity, then repay with interest over a fixed term. Missing payments can result in repossession.

What Affects Your Monthly Payment

  • Vehicle price: The sticker price or negotiated purchase price
  • Down payment: Cash paid upfront — more down = lower monthly payment and less interest
  • Trade-in equity: Your current car's value minus any remaining loan balance
  • Interest rate: Based on credit score, loan term, and lender
  • Loan term: Longer terms mean lower payments but more total interest
  • Taxes and fees: Sales tax, title, registration, and dealer documentation fees

Total Cost of Ownership

The monthly payment is just one piece. True cost includes:

  • Purchase price + interest: What you pay for the car over the loan term
  • Insurance: Full coverage is typically required for financed vehicles
  • Depreciation: New cars lose 20-30% of value in the first year
  • Maintenance: Tires, oil changes, repairs increase over time
  • Fuel: Factor in annual mileage and fuel efficiency

Loan Term Comparison

On a $30,000 loan at 6% interest:

  • 36 months: $913/mo — $2,862 total interest
  • 48 months: $704/mo — $3,807 total interest
  • 60 months: $580/mo — $4,799 total interest
  • 72 months: $497/mo — $5,834 total interest

Each additional year adds roughly $1,000 in interest costs.

Tips for Getting the Best Auto Loan

  • Check your credit score first: A score above 720 qualifies for the best rates
  • Get pre-approved: Apply at your bank or credit union before visiting the dealer
  • Negotiate the price, not the payment: Dealers can manipulate payment amounts by extending the term
  • Put at least 20% down: Avoid being underwater (owing more than the car is worth)
  • Keep the term under 60 months: Balances interest costs with affordable payments
  • Avoid add-ons: Extended warranties, GAP insurance, and paint protection can add thousands

Understanding the Amortization Schedule

Early payments are mostly interest; later payments are mostly principal. This is why paying extra toward principal early in the loan saves the most money. Even an extra $50/month can shave months off the loan and save hundreds in interest.

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Frequently Asked Questions

What is a good interest rate for a car loan?

As of 2025, good car loan rates run about 4 to 7 percent for new cars and 5 to 9 percent for used cars. The rate depends on credit score, loan term and lender. Credit unions often offer lower rates than dealership financing, so get a preapproved quote before visiting the dealer.

How is a monthly car payment calculated?

The payment is M = P x r(1+r)^n / ((1+r)^n - 1), where P is the amount financed, r is the monthly interest rate and n is the number of months. The amount financed is the price minus down payment and trade-in, plus any taxes and fees rolled into the loan.

How long should a car loan be?

A 36 to 48 month loan keeps total interest lowest but has higher payments. A 60 to 72 month loan lowers the payment but costs more interest overall. Terms of 84 months or longer are best avoided because the car can depreciate faster than the balance falls, leaving the borrower owing more than it is worth.

What happens to negative equity when you trade in a car?

If you owe more on the old car than its trade-in value, the difference is added to the new loan. That means borrowing more than the new car is worth from day one, which repeats the cycle on the next vehicle. Paying the gap in cash, or adding GAP insurance, limits the risk.