Auto Loan Calculator
Free car loan calculator with amortization schedule and extra payment support. See total interest, payoff date, and early payment savings instantly.
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What this auto loan calculator works out
It takes a vehicle price and turns it into a real monthly payment, the total interest you will pay, and the total cost of the car once financing is done. It also builds the full amortization schedule and lets you add an extra monthly amount to see how much time and interest that saves. Everything is calculated from the loan’s actual amortization formula, not an approximation.
How the payment is calculated
- Taxable amount = price − down payment − trade-in value. Subtracting the trade-in here reflects states that offer a trade-in tax credit.
- Sales tax = taxable amount × your tax rate.
- Amount financed = taxable amount + sales tax + fees (if you tick “finance tax & fees”) or just the taxable amount if you pay those at signing.
- Monthly payment uses the standard amortization formula: payment = P × r × (1+r)n ÷ ((1+r)n − 1), where r is the monthly rate and n the number of payments.
- Extra payments are added to every payment, with each instalment charged interest first and the remainder applied to principal.
A worked example
A $30,000 car with a $3,000 down payment, a $5,000 trade-in, 7% sales tax, $400 in fees, a 7.5% APR, and a 60-month term:
| Step | Calculation | Result |
|---|---|---|
| Taxable amount | 30,000 − 3,000 − 5,000 | $22,000 |
| Sales tax | 22,000 × 7% | $1,540 |
| Amount financed | 22,000 + 1,540 + 400 | $23,940 |
| Monthly payment | amortization formula | $479.71 |
| Total interest | schedule sum | $4,842.51 |
| Total of payments | 479.71 × 60 | $28,782.60 |
| Total cost | financed + interest + out of pocket | $36,782.51 |
Add even $50 a month and the schedule shortens, because every extra dollar goes straight to principal and removes the interest that dollar would have accrued for the rest of the term.
Why the amount financed is not just price minus down payment
Sales tax on a car is charged on the price after the down payment and trade-in, but it still has to be paid, and so do title, registration, and doc fees. If you finance those instead of paying them at signing, they join the principal and then attract interest for the life of the loan. The difference between a $22,000 taxable amount and a $23,940 financed amount is $1,940 that now costs interest too.
Common mistakes
- Comparing monthly payments only. A longer term lowers the payment but raises total interest. Two cars can have the same payment and very different costs.
- Ignoring the trade-in’s tax effect. In many states the trade-in reduces the taxable amount, saving several hundred dollars in tax. The calculator applies that automatically.
- Forgetting fees. Registration, dealer doc fees, and destination charges are real and often financed.
- Stretching to a 72- or 84-month loan. The payment falls, but you stay underwater on the car longer and pay more interest overall.
- Skipping the schedule. Looking at how much of each early payment goes to interest explains why paying early matters so much.
Frequently asked questions
How much car can I afford?
A common rule of thumb is to keep total transport costs under about 10–15% of gross monthly income, including payment, insurance, and fuel. Work backwards from the payment you can carry comfortably, then set the term to 60 months or less where possible.
Does a bigger down payment help?
Yes, in two ways: it reduces the amount financed, which cuts interest, and it reduces the taxable amount, which cuts sales tax. It also lowers the risk of being upside-down on the loan.
Should I finance tax and fees or pay at signing?
If you can pay them upfront without draining your savings, paying at signing avoids interest on that amount. Untick the finance box to model that. If cash is tight, financing them is not a disaster, but it does cost extra over the term.
Do extra payments go to interest or principal?
Each payment covers the month’s interest first; only the remainder touches principal. An extra payment therefore goes entirely to principal and eliminates all the future interest that principal would have earned. That is why small extras have an outsized effect near the start of a loan.
If you are still deciding between financing and leasing, the lease vs buy comparison uses the same payment maths over your ownership window. And if you simply want the payment without the tax and fee detail, the simple loan calculator strips it back.