Auto Loan Calculator
What will your monthly car payment be? Calculate loan costs, add trade-in value and fees, and compare financing against leasing side by side.
Try a scenario
How to Use This Calculator
Tab "Monthly Payment"
Enter the vehicle price, down payment, annual interest rate (APR), and loan term (36 to 84 months). The result shows your exact monthly payment, total interest paid, and the true total cost of ownership over the loan.
Tab "Trade-In & Extras"
Add your trade-in value, any negative equity (if you owe more on your current car than it is worth), sales tax percentage, and dealer or registration fees. The calculator adjusts the financed loan amount to reflect all these factors and shows your true monthly cost.
Tab "Loan vs Lease"
Compare the cost of financing (you own the car at the end) against leasing (you return the car). Enter the vehicle price, APRs for both options, lease term, and residual value as a percentage of the purchase price. The side-by-side table shows monthly payments, total paid, and what you own at the end.
The Formulas
M = P × [r(1+r)^n] / [(1+r)^n − 1]
where P = loan principal, r = monthly rate (APR / 12 / 100), n = total months
Loan principal with trade-in:
P = Price − Down − Trade-In + Negative Equity + (Price × Tax%) + Fees
Total interest paid:
Interest = (M × n) − P
Lease monthly payment:
Monthly = (Depreciation / n) + Finance Charge
Depreciation = MSRP − Residual Value
Finance Charge = (MSRP + Residual) × (Money Factor)
Money Factor = APR / 2400
Residual Value:
Residual = MSRP × Residual%
All calculations use standard automotive finance mathematics. No country-specific tax rates are applied automatically โ enter your local rate in the Trade-In tab.
Worked Examples
Example 1 โ Basic loan: $35,000 car, $5,000 down, 6.5% APR, 60 months
A buyer purchases a $35,000 car with a $5,000 cash down payment, securing a 60-month loan at 6.5% APR.
M = 30000 × [0.005417 × (1.005417)^60] / [(1.005417)^60 − 1] = $586.90/month. Over 5 years, $5,214 is paid in interest โ equivalent to 17.4% on top of the loan principal.
Example 2 โ With trade-in: same car + $8,000 trade-in with $2,000 negative equity
The same buyer adds an $8,000 trade-in value, but owes $10,000 on the existing car โ creating $2,000 of negative equity that rolls into the new loan.
The $8,000 trade-in reduces the loan, but the $2,000 negative equity partially offsets the benefit. The net financed amount drops to $24,000 and the monthly payment falls from $586.90 to $469.28 โ saving $117/month compared to Example 1.
Example 3 โ Finance vs Lease: $35,000 car over 60-month loan vs 36-month lease (55% residual)
Comparing a full purchase at 6.5% APR over 60 months against a 36-month lease with 55% residual value.
| Metric | Finance (own) | Lease (return) |
|---|---|---|
| Term | 60 months | 36 months |
| Monthly payment | $586.90 | ~$347/mo |
| Total paid over term | $35,214 (incl. down) | ~$17,492 (incl. down) |
| Asset at end | Car worth ~$19,250 | Nothing โ car returned |
| True cost | $35,214 (car owned) | $17,492 + no asset |
Leasing is cheaper per month and cheaper in total over a single term โ but at the end you own nothing. Finance costs more upfront but leaves you with a $19,250 asset (approximate value after 5 years). The decision depends on how long you keep cars and whether ownership matters to you.
Understanding Auto Loans: Key Concepts
How Loan Term Affects Total Cost
Stretching a loan from 48 to 72 months reduces your monthly payment but increases total interest significantly. On a $30,000 loan at 6.5%: a 48-month term costs $711/month but only $4,106 in total interest. A 72-month term costs $506/month but $6,420 in total interest โ 56% more. Longer terms feel affordable but are expensive overall.
What Is APR vs Interest Rate?
The interest rate is the base cost of borrowing. The APR (Annual Percentage Rate) includes the interest rate plus any mandatory fees rolled into the loan, giving a more accurate picture of the true annual cost. Always compare APRs โ not just rates โ when shopping lenders.
Negative Equity: When Your Car Is Underwater
You have negative equity when you owe more on your current car than it is worth. This happens because cars depreciate faster than many loans are paid down, especially in the early months of a long loan. When you trade in a car with negative equity, the shortfall rolls into the new loan, immediately increasing the amount you owe โ sometimes by thousands.
The Real Cost of Leasing
Lease monthly payments look attractive because you only finance the depreciation (what the car loses in value during the lease), not the full purchase price. However, at lease end you return the car and start again. Over 10 years of continuous leasing, total costs typically exceed what you would have paid buying a car and keeping it for 7-8 years. Leasing makes most sense if you change cars frequently, want lower payments, or always want a new car under warranty.
Down Payment Strategy
A larger down payment reduces the loan principal, monthly payment, and total interest. It also reduces the risk of negative equity early in the loan when depreciation is fastest. As a rule of thumb, aim for at least 10-20% down on a new car purchase. On used cars, any down payment reduces risk significantly.
Frequently Asked Questions
Calculate for Your Country
For country-specific auto loan calculators that include local tax rules, duty, and registration costs: