What this auto loan calculator does
Enter the vehicle price, your down payment, any trade-in value, the interest rate and the loan term. The calculator adds sales tax, subtracts your down payment and trade-in, and works out the monthly payment on the amount you finance.
How the payment is calculated
The amount financed is the price plus sales tax (charged on the price minus the trade-in, as in many places) minus the down payment and trade-in. The payment then follows the standard loan formula: P × r ÷ (1 − (1 + r)−n), where r is the monthly rate and n the number of months.
Tips to pay less for a car loan
- Make a larger down payment to borrow less and avoid owing more than the car is worth.
- Choose the shortest term you can afford; long loans of 72 to 84 months cost much more interest.
- Compare rates from banks, credit unions and dealers before you sign.
- Negotiate the vehicle price separately from the financing.
- Remember insurance, fuel and maintenance when deciding what you can afford.
Sales tax rules and fees vary by location, so treat the result as an estimate.
Frequently asked questions
Is sales tax included?
Yes. Enter your local rate, or 0 if tax is already included in the price.
What term should I choose?
Shorter terms have higher payments but save a lot of interest. Many buyers aim for 60 months or less.
Does it include registration and insurance?
No. Add these costs to your budget separately.