How is my monthly auto loan payment calculated?

Monthly payment = P × [r(1+r)^n] / [(1+r)^n − 1], where P is loan amount, r is monthly interest rate, and n is number of payments.

What is a good auto loan interest rate?

For excellent credit (750+), expect 5–7% on new cars and 7–9% on used cars. Good credit (690–749) typically gets 7–9% new / 9–12% used.

How much should I put down on a car?

Financial advisors recommend at least 20% down on a new car and 10% on a used car. This keeps you from going underwater immediately due to depreciation.

What is the 20/4/10 rule for buying a car?

Put 20% down, finance for no more than 4 years, and keep total car expenses (payment + insurance) under 10% of gross monthly income.

What is LTV in an auto loan?

Loan-to-Value (LTV) is the loan amount divided by the vehicle's value. Below 80% is healthy; above 100% means you owe more than the car is worth (negative equity).

Is it better to lease or buy a car?

Leasing has lower monthly payments but you build no equity. Buying costs more monthly but you own the asset. If you drive over 12,000 miles/year or keep cars long-term, buying is usually better.

What is the total cost of ownership for a car?

Total cost of ownership includes loan payments, interest, insurance, maintenance, fuel, registration, and depreciation loss. Over 5 years, this often exceeds twice the sticker price.

How does a trade-in affect my auto loan?

A trade-in's equity reduces your loan amount. If you owe more on your trade-in than it's worth (negative equity), that balance is rolled into the new loan, increasing what you owe.

Auto Loan Calculator | Monthly Payment, Total Cost & True Cost

Auto Loan Calculator

Monthly payment · Amortization · Total cost of ownership · Scenario analysis · Lease vs Buy

Vehicle Condition

Vehicle Type

Down Payment 20%

Rate Presets

MONTHLY PAYMENT $543

Total Interest —

Payoff Date —

LTV —

Deal Grade A

Loan Amt —

Interest —

Tax & Fees —

Total Cost —

Monthly P&I —

Total Interest —

Payoff Date —

LTV Ratio —

Effective APR —

Interest % of Price —

Vehicle Price —

− Down Payment & Trade-in —

+ Tax & Fees —

= Loan Amount —

Total Interest Paid —

Total Cost of Loan —

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Budget Health

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20/4/10 Rule

— ≥20% Down

— ≤48 mo Term

— ≤10% Income

#	Date	Payment	Principal	Interest	Balance

Bear / Base / Bull Scenarios

Rate × Term Sensitivity

Monthly payment at different rate & term combinations. Your current scenario is highlighted.

Loan A vs Loan B

Loan B Rate

Loan B Term

Credit Score Impact

Score Range	Typical APR	Monthly Payment	Total Interest	vs. Current

Based on current vehicle price, down payment, and loan term.

Vehicle Depreciation

See when your loan balance drops below your vehicle's market value.

Depreciation Profile:

⛽ Fuel Cost Estimate

Total Cost of Ownership

💳

Loan Payments Total

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📉

Est. Depreciation Loss

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🛡️

Est. Insurance (5yr)

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🔧

Est. Maintenance (5yr)

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⛽

Est. Fuel Costs (5yr)

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True 5-Year Cost to Own —

Year-by-Year Equity Tracker

Year	Vehicle Value	Loan Balance	Equity	Cum. Paid

Lease vs. Buy

Monthly Lease

Lease Term (mo)

Quick What-If Scenarios

Click any card to instantly apply and see the impact

💰 Put 20% Down —

📅 48-Month Term —

⭐ Excellent Credit —

➕ +$100/mo Extra —

📆 Bi-weekly Payments —

📈 Improve Credit 1 Tier —

How to Use

Configure Your Loan

Enter the vehicle price, your down payment, and select your credit score tier. The calculator automatically sets a market-rate APR. Use the Costs tab to add trade-in, sales tax, and fees.

Analyze All Three Views

The Monthly View shows your payment, interest, and amortization schedule. Scenario Analysis compares Bear/Base/Bull rates and a sensitivity matrix. True Cost reveals the real lifetime cost including depreciation.

Optimize Your Decision

Use the What-If cards to instantly test scenarios. Check the alert stack for personalized tips. Compare Lease vs Buy in the True Cost tab. Share your scenario via URL or export to CSV.

How to Use This Calculator

Enter Loan Details

Input the vehicle price, down payment, loan term, and interest rate.

Add Trade-In

Include any trade-in value or manufacturer rebates to reduce the loan amount.

Review Payment Schedule

See your monthly payment, total interest, and amortization breakdown.

Formula & Methodology

Monthly Payment

M = P[r(1+r)^n] / [(1+r)^n - 1]

Where P = loan amount, r = monthly interest rate, n = number of monthly payments.

Total Interest

Total Interest = (Monthly Payment x n) - Principal

The total amount paid above the original loan balance over the life of the loan.

About this calculation · Accuracy & Methodology

Key Terms

APR: Annual Percentage Rate — the yearly interest rate charged on the loan, including fees.
Principal: The original amount borrowed, calculated as vehicle price minus down payment and trade-in.
Amortization: The process of paying off a loan through regular payments that cover both interest and principal.
Upside Down: Owing more on the loan than the vehicle is currently worth, common in the early years of long-term loans.
Loan-to-Value: The ratio of the loan amount to the vehicle's value. Lenders typically cap this at 100-125%.

Real-World Examples

Example 1

New Car Purchase

Price: $35,000, Down payment: $5,000, Rate: 5.9%, Term: 60 months

Result: Monthly payment = $579, Total interest = $4,740. The loan costs about $95/year per $10,000 borrowed.

Example 2

Used Car Financing

Price: $18,000, Down payment: $3,000, Rate: 7.5%, Term: 48 months

Result: Monthly payment = $363, Total interest = $2,424. Shorter term reduces total interest significantly.

Loan Term Comparison ($30,000 at 6%)

Term	Monthly Payment	Total Interest	Total Paid
36 months	$913	$2,868	$32,868
48 months	$704	$3,792	$33,792
60 months	$580	$4,800	$34,800
72 months	$497	$5,784	$35,784

Smart Auto Loan Strategies

Shorter Terms Save Thousands

While a 72-month loan has lower monthly payments, it costs significantly more in total interest and keeps you underwater longer. Aim for the shortest term you can afford — ideally 48 months or less.

The Down Payment Sweet Spot

Putting 20% down avoids being upside-down on day one and often qualifies you for better rates. At minimum, cover taxes, title, and fees out of pocket so you're not financing transaction costs.

Dealer vs. Bank Financing

Get pre-approved by your bank or credit union before visiting the dealer. This gives you a baseline rate to negotiate against. Dealers sometimes offer promotional rates on new cars that beat bank rates.