Auto Loan Calculator
Estimate your monthly car payment from the vehicle price, down payment, trade-in, sales tax, interest rate (APR), and loan term — and see how much of the loan is interest over its life.
The calculator finances your out-the-door amount (price plus sales tax, minus down payment and trade-in) and amortizes it, so the monthly figure reflects what you will actually pay the lender.
Estimated monthly payment
$680.29
- Sales tax
- $2,450
- Amount financed
- $33,950
- Total interest paid
- $6,867
- Total of payments
- $40,817
Amortization schedule (yearly)
| Year | Principal paid | Interest paid | Remaining balance |
|---|---|---|---|
| 1 | $5,814 | $2,349 | $28,136 |
| 2 | $6,266 | $1,898 | $21,870 |
| 3 | $6,752 | $1,411 | $15,118 |
| 4 | $7,276 | $887 | $7,841 |
| 5 | $7,841 | $322 | $0 |
Calculation Formulas
Sales tax is applied to the price after the trade-in credit (the rule in most states), then the down payment is subtracted. The result is the principal the loan is based on.
Example:
$32,000 car, $2,000 trade-in, 7% tax, $3,000 down → tax = 7% × $30,000 = $2,100 → financed = $30,000 + $2,100 − $3,000 = $29,100.
P is the amount financed, r is the monthly rate (APR ÷ 12), and n is the term in months. This yields the fixed monthly payment.
Every payment over the full term minus the amount financed is your lifetime interest cost.
Key Figures
| Figure | Value | Description |
|---|---|---|
| Common terms | 48 / 60 / 72 months | The most widely offered new-car loan lengths. |
| Trade-in tax credit | Most states | Sales tax charged on price minus trade-in; a few states tax the full price. |
Note: Results are estimates for planning purposes. Rates, fees, taxes, and insurance vary by lender and location — confirm exact figures with a licensed professional before making financial decisions.
Standards & Sources
Last verified: July 2026
- Truth in Lending Act (TILA) — APR disclosure
Requires lenders to disclose the Annual Percentage Rate, which includes certain finance charges — the number to use when comparing loan offers.
- State motor-vehicle sales tax rules
Whether a trade-in reduces taxable price varies by state. This calculator applies the common trade-in tax credit; confirm your state’s rule for an exact figure.
How to Use This Calculator
- Enter the vehicle price, your down payment, and any trade-in value.
- Enter your sales tax rate and the APR the dealer or bank quoted.
- Choose the loan term in months (48, 60, and 72 are the most common).
- Read your estimated monthly payment, the total amount financed, and the total interest you will pay.
Frequently Asked Questions
How is my monthly car payment calculated?
The amount financed — vehicle price plus sales tax, minus your down payment and trade-in — is amortized over the loan term using the standard formula M = P · r · (1 + r)^n / ((1 + r)^n − 1), where r is your monthly rate (APR ÷ 12) and n is the number of months.
Does a trade-in reduce my sales tax?
In most U.S. states, yes — sales tax is charged on the price after subtracting the trade-in value, which lowers both the tax and the amount you finance. A handful of states tax the full price; this calculator applies the common trade-in tax credit, so verify the rule for your state.
What loan term should I choose for a car?
Shorter terms (36–48 months) mean higher monthly payments but far less total interest and less time spent owing more than the car is worth. Longer terms (72–84 months) lower the payment but increase total interest and the risk of being "underwater." Compare terms here before deciding.
What is the difference between APR and interest rate?
The interest rate is the cost of borrowing the principal; APR also folds in certain loan fees, so it is usually slightly higher and is the better number for comparing offers. Enter the APR here for the most realistic monthly payment.
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