Auto Loan Calculator
Calculate your monthly car payment, total interest, and full amortization schedule — with an optional trade-in value subtracted from the amount financed.
Calculator verified • Last updated: August 2026
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Term Comparison
| Term | Monthly Payment | Total Interest |
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Payment Breakdown
Amortization Schedule
| Period | Payment | Principal | Interest | Balance |
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Balance Over Time
Your fixed monthly payment stays the same for the life of the loan, but what it covers shifts — early payments go mostly toward interest, later ones pay down more principal, so the balance drops slowly at first and faster as you get closer to paying it off.
How to Calculate an Auto Loan Payment
A car loan is a fixed-rate installment loan — the same type of loan as a mortgage, just over a shorter term and a smaller amount. The monthly payment comes from the standard amortization formula:
M: the monthly payment.
P: the amount financed — vehicle price plus sales tax and title/registration fees (if entered), minus down payment and trade-in value.
r: the monthly interest rate (the annual rate divided by 12).
n: the number of monthly payments (loan term in years × 12).
Trade-In Value Works Just Like a Down Payment
Both a cash down payment and a dealer's trade-in offer reduce the amount you finance dollar for dollar before the interest formula is ever applied. A 32,000-dollar car with a 3,000-dollar down payment and a 4,000-dollar trade-in only requires financing 25,000 dollars — the loan, and the interest charged on it, are calculated against that smaller amount.
Sales Tax and Title Fees Usually Get Financed Too
Most dealers don't ask you to pay sales tax and title/registration fees out of pocket at signing — they roll both into the loan alongside the vehicle price, the opposite direction from a down payment or trade-in. Enter your state's sales tax rate and any title/registration fees in the optional fields above and this calculator adds them into the amount financed the same way, before the down payment and trade-in are subtracted:
Price: the vehicle's negotiated price before tax or fees.
Tax Rate: your state's sales tax rate, applied to the vehicle price alone.
Fees: title and registration fees, added as a flat dollar amount.
Why Loan Term Length Changes Total Interest So Much
A longer term lowers the monthly payment by spreading the same principal over more payments, but it also means interest keeps accruing on a slower-shrinking balance for longer — the total interest paid over the life of the loan can be dramatically higher on a 7-year term than a 3-year term for the exact same vehicle price and rate, even though the monthly payment looks more affordable.
Worked Example
A 32,000-dollar vehicle with a 3,000-dollar down payment (no trade-in) financed at 7% for 5 years: the amount financed is 29,000 dollars, the monthly rate is 7% ÷ 12 ≈ 0.5833%, and n = 60 payments. Plugging into the formula gives a monthly payment of about 574 dollars, with roughly 5,454 dollars in total interest over the 5 years.
Auto Loan Terms You Should Know
Amount Financed — the principal actually borrowed: vehicle price plus sales tax and title/registration fees (if entered), minus every reduction (down payment, trade-in, rebates) applied before the loan is calculated.
Amortization — the process of paying off a loan through fixed, regular payments, where each payment's split between principal and interest shifts over time as the balance shrinks.
APR — Annual Percentage Rate, the yearly cost of borrowing including certain fees, distinct from the simpler stated interest rate this calculator uses directly.
This calculator provides estimates for educational and planning purposes only. Actual loan terms depend on your lender, credit profile, and the specific rate and fees they offer. Consult a qualified financial advisor or lender for guidance specific to your situation.
Frequently Asked Questions
How is a car loan payment calculated?
The same fixed-rate amortization formula used for mortgages: M = P × r(1+r)^n / [(1+r)^n − 1], where P is the amount financed (vehicle price plus sales tax and title/registration fees, if entered, minus down payment and trade-in), r is the monthly interest rate, and n is the number of monthly payments.
Does a trade-in reduce my loan the same way a down payment does?
Yes — both reduce the amount you finance dollar for dollar. A 5,000-dollar trade-in and a 5,000-dollar cash down payment shrink the loan principal by the exact same amount, which is why this calculator subtracts both from the vehicle price before computing the payment.
Why do shorter auto loan terms usually have lower interest rates?
Lenders take on less risk over a shorter repayment window — less time for the borrower's situation to change and less time for the car's value to depreciate below the remaining loan balance. That lower risk is often (though not always) priced in as a lower rate.
Does this calculator include sales tax on the vehicle?
Yes, as an optional field — enter your state's sales tax rate in "Sales Tax Rate (%)" and it's calculated on the vehicle price and added into the amount financed, the same way a dealer's F&I office structures it. There's also an optional "Title & Registration Fees ($)" field for DMV fees rolled into the loan the same way. Both default to 0, so leaving them alone gives you a pre-tax, pre-fee estimate.
If I pay it off early or make extra payments, do I save money — and is there a prepayment penalty?
Most auto loans have no prepayment penalty, so paying extra almost always saves money — it goes straight to principal, which reduces the interest that accrues on every future payment, the same way the Extra Monthly Payment field above shows. A minority of loans, especially some subprime or dealer-financed contracts, do carry a prepayment penalty clause, so it's worth checking your specific loan agreement before assuming extra payments are free of cost.
How would a better or worse credit score change my auto loan rate?
Lenders price auto loan rates largely off credit-score tiers, and the gap between tiers can be substantial: borrowers with superprime credit (roughly 781 and up) typically see the lowest advertised rates, prime (661-780) and nonprime (601-660) pay progressively more, and subprime/deep subprime borrowers (600 and below) often see rates several times higher than a superprime borrower for the identical vehicle and loan term. These ranges are illustrative — actual cutoffs and rates vary by lender, loan term, and the scoring model used, so check your own real rate quote rather than relying on a tier alone.