The formula
How it works
Estimate the monthly payment on a car loan, including sales tax, your down payment and any trade-in. The calculator shows how much you actually finance, the monthly payment, and the total interest over the loan.
FAQ
How does a trade-in lower my payment?
Its value comes off the price like extra cash down, so you borrow less. In many places the trade-in also reduces the amount that sales tax is charged on, saving you more.
Should I take a longer loan for a lower payment?
A longer term lowers the monthly payment but raises the total interest, and it can leave you owing more than the car is worth. Aim for the shortest term you can comfortably afford.
How much difference does a bigger down payment make?
Every extra dollar down reduces the amount financed directly, so it lowers both your monthly payment and the total interest you pay. A larger down payment can also help you avoid owing more than the car is worth in the early months.
Is APR the same as the interest rate?
Not quite — the interest rate covers only the cost of borrowing, while the APR also folds in certain lender fees, giving a fuller picture of the loan’s true annual cost. This calculator uses the rate you enter as the APR for the monthly payment math.
Does this include registration and other fees?
No, it only accounts for the vehicle price, sales tax, down payment and trade-in. Title, registration and documentation fees vary by state or dealer and would need to be added separately if financed.
Should I get pre-approved before visiting a dealer?
Yes — a pre-approved rate from a bank or credit union gives you a benchmark to compare against dealer financing, and often stronger negotiating leverage. Use this calculator with a few different rates to see how much a better offer would actually save you.
Can I use this for refinancing an existing auto loan?
You can approximate it by entering your current payoff balance as the vehicle price, setting down payment and trade-in to zero, and using the new rate and term. It won’t capture refinance fees, but it will show the new monthly payment and interest.
About the auto loan calculator
This calculator estimates the monthly payment on a car loan, taking account of the vehicle price, sales tax, your down payment and a trade-in. Buying a car is one of the biggest purchases most people make on credit, and the sticker price is only part of the story. By folding in tax and subtracting what you put down, the calculator shows the amount you actually finance and what it will cost you each month.
How to use it
Enter the vehicle price, your cash down payment, the value of any car you are trading in, the local sales tax rate, the loan’s APR and the term in years. The calculator adds tax to the price, subtracts your down payment and trade-in, and works out the monthly payment and total interest. For example, a $30,000 car with $5,000 down and 6% tax, financed at 6% over 5 years, costs roughly $518 a month.
The formula
First the amount financed is found: the price plus sales tax, minus the down payment and trade-in. Then the standard loan payment formula applies, , where is that financed amount, is the monthly rate (APR divided by 12) and is the number of months. Sales tax is usually charged on the price after any trade-in is deducted, which is how this calculator applies it.
Where it is used
Car buyers use it to set a realistic budget before visiting a dealer, and to check that a quoted monthly payment matches the price, rate and term on offer. It helps compare financing deals, weigh a bigger down payment against a longer term, and see the true cost of add-ons rolled into the loan. Dealers and lenders run the same calculation to structure and present finance offers.