Car Loan Calculator

Calculate your monthly car loan payment, total interest, and total cost.

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Enter your values and click Calculate

Enter your loan amount, the annual interest rate, and loan term length to instantly see your exact monthly payment, the total interest you will pay over the life of the loan, and the total amount paid including principal. This calculator is an essential tool before signing any auto financing agreement. Dealers routinely present only the monthly payment figure — but two loans with the same monthly payment can have vastly different total costs if they differ in term length or interest rate. A 72-month loan at 8% on $25,000 may have a lower monthly payment than a 48-month loan, but costs thousands more in total interest. Use this calculator to compare financing offers side by side, understand what your trade-in or down payment actually saves you in interest, and evaluate whether the dealer's financing beats what your bank or credit union offers. Knowing the full cost of a loan empowers you to negotiate from a position of knowledge rather than just accepting what the finance manager presents.

How It Works

The monthly payment is calculated using the standard loan amortization formula: M = P × r(1+r)^n ÷ ((1+r)^n − 1), where P is the loan principal, r is the monthly interest rate (annual rate ÷ 12), and n is the total number of monthly payments. For example, a $25,000 loan at 6.5% annual rate (0.5417% monthly) for 60 months: r = 0.065 ÷ 12 = 0.005417; (1+r)^60 = 1.005417^60 ≈ 1.383; M = 25000 × (0.005417 × 1.383) ÷ (1.383 − 1) = 25000 × 0.007492 ÷ 0.383 ≈ $489 per month. Total amount paid equals the monthly payment multiplied by the number of months. Total interest equals total paid minus the original principal. The formula assumes equal monthly payments and standard compound interest with monthly compounding.

Examples

New Car Loan
$25,000 at 6.5% for 60 months — a typical new vehicle financing scenario.
Result: ~$489/month. ~$4,350 total interest. Total paid: ~$29,350.
Used Car Loan
$15,000 at 9% for 48 months — used car at a higher interest rate.
Result: ~$373/month. ~$2,900 total interest. Total paid: ~$17,900.
Long-Term Financing
$35,000 at 7% for 84 months — longer term keeping monthly payments lower.
Result: ~$532/month. ~$9,700 total interest — much more than a 60-month term.

Frequently Asked Questions

Does this include taxes or fees?
No — the calculator uses only the loan amount you enter. If taxes, registration fees, dealer documentation fees, or an extended warranty are being rolled into the loan, add those amounts to the principal before entering it. This is a common practice that significantly inflates the amount financed and the total interest paid.
Should I choose a shorter or longer term?
Shorter terms have higher monthly payments but significantly less total interest and build equity faster, reducing the risk of being upside-down on the loan. Longer terms reduce the monthly payment but increase total cost considerably — compare the 60-month and 84-month examples above to see the difference. Choose the shortest term where the payment comfortably fits your budget.
Should I finance through the dealer or my bank?
Always get a pre-approval from your bank or credit union before visiting the dealership. This gives you a baseline rate to compare against the dealer's financing offer. Dealers sometimes offer manufacturer-subsidized rates (0% or 1.9% deals) that beat bank rates, but non-promotional dealer financing often carries a markup of 1–2 percentage points above the rate the dealer could offer, as a source of additional profit.

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