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Car Loan Calculator
A car's price tag is not what it costs you — the loan is. Plug in the price, down payment, APR, and term to see your real monthly payment and how much interest you'll pay before you ever talk to a dealer.
For education only — not financial advice. Taxes, title, dealer fees, and insurance are not included.
How this car loan calculator works
The calculator runs standard loan amortization — the same math your bank uses. It subtracts your down payment from the price to get the loan principal, then spreads it over the term using the monthly interest rate (APR ÷ 12). The monthly payment stays fixed, while the split between interest and principal shifts: early payments are mostly interest, later ones mostly principal.
Take a $32,000 car with a $6,400 down payment at 7.5% APR over five years. You borrow $25,600 and pay about $513 a month — but the interest adds up to roughly $5,200. That is the number dealers hope you never calculate: the car does not cost $32,000. It costs $37,200 before tax, title, and fees. Stretching the same loan to seven years drops the payment to about $393, but interest climbs to nearly $7,400. A lower payment is almost never cheaper.
If your APR is 0% — common with manufacturer promos on new cars — the math is simple: principal divided by months. Even then, run the numbers, because a $2,000 cash rebate you skip for the 0% deal can be worth more than the interest you save.
The 20/4/10 rule: can you actually afford this payment?
Affordability is not "the payment fits in my budget this month." Cars lose value every year, and an over-borrowed car traps you owing more than it is worth. A widely used guardrail is the 20/4/10 rule: put at least 20% down, keep the term to 4 years or less, and keep total car costs (payment + insurance + gas + maintenance) under 10% of your gross income.
This is exactly where the calculator earns its keep. Find your payment, add your insurance quote and fuel estimate, and test the total against 10% of your monthly income. If a $35,000 SUV fails the test, the answer is not a 7-year loan that "makes it fit" — it is a $25,000 car. We break down why car payments quietly destroy budgets in How Car Payments Eat Your Salary (and the 20-4-10 Rule).
According to Experian, the average new-car loan payment in the US now tops $700 a month — more than many people's grocery bill. That is why running the numbers before shopping is the single smartest car-buying move you can make.
Mistakes to avoid before you sign
1. Shopping by monthly payment. Dealers love payment shoppers because extending the term can fit almost any car into any payment — while quietly adding thousands in interest. Agree on the out-the-door price first, then talk financing.
2. Skipping pre-approval. Walking in with a pre-approved rate from your bank or credit union turns the finance office from a trap into a competition. Credit unions frequently beat dealer rates by a full point or more.
3. Rolling negative equity. If you owe more on your old car than it is worth, dealers will happily roll the difference into the new loan. You are then paying interest on debt for a car you no longer own — sometimes $3,000 to $5,000 of it.
4. Finance-office add-ons. Extended warranties, paint protection, and GAP insurance sold at the dealership are often double the price you would pay elsewhere. Decide on each before you arrive, and know that GAP insurance is worth considering only if your down payment is small.
5. Forgetting the real cost of ownership. The payment is just the start. Insurance, fuel, tires, and repairs run most drivers another $200–$400 a month. Use our 50/30/20 budget planner to see whether the full package fits your needs bucket before you commit.
Frequently Asked Questions
What is a good APR for a car loan in 2026?
It depends on your credit score and whether the car is new or used. Borrowers with excellent credit often see rates around 5–7% on new cars, while fair-credit borrowers may face 10% or more, and used cars usually run 1–2 points higher. Anything under 6% with good credit is solid; above 10% deserves a second look or a larger down payment.
How much down payment should I put on a car?
Aim for at least 20% of the price. A big down payment shrinks your loan and your interest, often unlocks a better rate, and keeps you from going "upside down" — owing more than the car is worth — as it depreciates. If 20% is out of reach, put down as much as you can without draining your emergency fund.
Is a 72-month car loan a bad idea?
Usually, yes. A 72-month term can cut your payment by 20% but adds thousands in interest, and the car depreciates faster than you pay it off — you can owe more than it is worth for years. Four years is the sweet spot for balancing payment size and total cost; five is the maximum most financial planners recommend.
Does this car loan calculator include taxes and fees?
No. It covers price, down payment, APR, and term. In reality, sales tax, title, registration, and dealer fees add 8–12% to the price in most states, so add those to the "vehicle price" field if you want the truest picture.
Can I use this calculator for a used car loan or refinancing?
Yes. For a used car, enter the negotiated price and use a slightly higher APR, since used-car rates run above new-car rates. For refinancing, enter your remaining balance as the price, $0 as the down payment, and your new rate and term — the total interest shows exactly what you would save.