Calculate your monthly car payment, total interest, and true cost of your vehicle purchase including trade-in value and sales tax.
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⚠️ Depreciation Warning: A new car loses ~20% of its value in the first year. With a small down payment, you may owe more than the car is worth early in your loan.
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How to Use the Auto Loan Calculator
Also searched as: car loan calculator | auto loan calculator monthly payment | vehicle loan calculator | car payment calculator free Optimized for US users with American units and terminology.
Enter the vehicle price, your down payment, any trade-in value, sales tax rate, interest rate, and loan term to instantly see your monthly car payment and total loan cost. The trade-in and down payment are subtracted from the vehicle price before calculating your loan amount. Sales tax is added to the financed amount.
How Car Loan Payments Are Calculated
Your monthly car payment is based on the net loan amount — vehicle price minus down payment and trade-in, plus applicable sales tax. The standard amortization formula distributes payments equally over the loan term, with the interest portion decreasing and the principal portion increasing each month as you pay down the balance.
New Car vs. Used Car Financing
New car loans typically carry lower interest rates than used car loans because new vehicles are considered lower risk as loan collateral. However, new cars depreciate rapidly — losing around 20% of their value in the first year and up to 50% within three years. Used cars have already absorbed much of this depreciation, often making them a more financially efficient purchase. The best choice depends on your budget, needs, and how long you plan to keep the vehicle.
Avoiding Being Underwater on Your Loan
Being underwater means you owe more on your loan than the car is worth. This is most common with long loan terms and small down payments on new vehicles. To avoid it, put at least 20% down on a new car, keep loan terms to 60 months or less, and consider gap insurance for added protection. Use this calculator to see your loan balance month by month compared to the car's expected value.
Frequently Asked Questions
Use the Car Loan Calculator above — enter your values and get instant results. This free online tool calculates car loan calculator monthly payment without any download or signup required. Results update in real time as you type.
Use the Car Loan Calculator above — enter your values and get instant results. This free online tool calculates how much car can i afford without any download or signup required. Results update in real time as you type.
GAP insurance covers the difference between what you owe on your loan and what your car is worth if it's totaled or stolen. It's most valuable when you have a small down payment or a long loan term on a new vehicle. It's often worth the cost for the first 1–2 years of ownership.
If you can get a rate under 4%, financing may make sense even if you have the cash — investing the difference could earn more than you pay in interest. At higher rates, paying cash saves the most money. Compare the total loan interest cost against what you could earn investing the same amount.
Yes. Refinancing is most beneficial if your credit score has improved since you got the original loan or if market rates have dropped. Most auto refinance lenders don't charge fees, making it a low-risk way to reduce your monthly payment or total interest cost.
Your trade-in value reduces the amount you need to finance, lowering your monthly payment and total interest. In many states, trading in a vehicle also reduces the sales tax you owe — you only pay tax on the difference between the new car price and the trade-in value.