Car Loan Calculator
Calculate your monthly car loan payment.
Enter vehicle price, down payment, interest rate, and loan term to estimate your payments.
Car loan payments are calculated using the standard amortizing loan formula — the same mathematics used for mortgages and personal loans.
Monthly payment formula:
Monthly Payment = P × [r(1+r)^n] / [(1+r)^n − 1]
Where:
- P = Principal (vehicle price minus down payment)
- r = Monthly interest rate = Annual rate ÷ 12
- n = Total number of monthly payments (years × 12)
Total cost and interest paid:
Total Paid = Monthly Payment × n
Total Interest = Total Paid − Principal
Worked example:
Vehicle price: $32,000. Down payment: $4,000. Loan: $28,000.
APR: 6.5% → monthly rate r = 6.5% ÷ 12 = 0.5417%.
Term: 60 months.
Payment = 28,000 × [0.005417 × (1.005417)^60] / [(1.005417)^60 − 1]
(1.005417)^60 ≈ 1.3828
Payment = 28,000 × [0.005417 × 1.3828] / [1.3828 − 1]
Payment = 28,000 × 0.007490 / 0.3828 ≈ $548/month
Total paid = $548 × 60 = $32,880 — you pay $4,880 in interest.
Typical auto loan rates (2025–2026):
- Excellent credit (720+): 4–6%
- Good credit (660–719): 6–8%
- Fair credit (600–659): 8–12%
- New cars generally 1–2% lower than used cars
Money-saving tips:
- A 20% down payment prevents being “underwater” on the loan
- Keep terms to 60 months or less — 72–84 month loans cost significantly more in interest
- Rates from credit unions are often 1–2% below dealership financing