function calculateAutoLoan() {
// Get input values
var price = parseFloat(document.getElementById('vehiclePrice').value);
var tradeIn = parseFloat(document.getElementById('tradeInValue').value);
var downPayment = parseFloat(document.getElementById('downPayment').value);
var fees = parseFloat(document.getElementById('docFees').value);
var taxRate = parseFloat(document.getElementById('salesTax').value);
var interestRate = parseFloat(document.getElementById('interestRate').value);
var months = parseInt(document.getElementById('loanTerm').value);
// Validation
if (isNaN(price) || price Price, Taxable is 0.
var taxableAmount = Math.max(0, price – tradeIn);
// 2. Calculate Tax
var taxAmount = taxableAmount * (taxRate / 100);
// 3. Calculate Total Out the Door Price (before financing)
var totalCashPrice = (price – tradeIn) + taxAmount + fees;
// 4. Calculate Loan Amount (Principal)
var loanPrincipal = totalCashPrice – downPayment;
// Edge Case: If down payment covers the car
if (loanPrincipal <= 0) {
document.getElementById('resultsArea').style.display = 'block';
document.getElementById('monthlyPaymentDisplay').innerText = "$0.00";
document.getElementById('loanAmountDisplay').innerText = "$0.00";
document.getElementById('taxDisplay').innerText = "$" + taxAmount.toLocaleString(undefined, {minimumFractionDigits: 2, maximumFractionDigits: 2});
document.getElementById('totalInterestDisplay').innerText = "$0.00";
document.getElementById('totalCostDisplay').innerText = "$" + (price + taxAmount + fees).toLocaleString(undefined, {minimumFractionDigits: 2, maximumFractionDigits: 2});
return;
}
// 5. Calculate Monthly Payment
var monthlyPayment = 0;
var totalInterest = 0;
if (interestRate === 0) {
monthlyPayment = loanPrincipal / months;
totalInterest = 0;
} else {
var monthlyRate = (interestRate / 100) / 12;
// Amortization Formula: P * (r(1+r)^n) / ((1+r)^n – 1)
monthlyPayment = loanPrincipal * (monthlyRate * Math.pow(1 + monthlyRate, months)) / (Math.pow(1 + monthlyRate, months) – 1);
var totalPayments = monthlyPayment * months;
totalInterest = totalPayments – loanPrincipal;
}
var totalCostOfCar = price + taxAmount + fees + totalInterest;
// Display Results
document.getElementById('resultsArea').style.display = 'block';
// Format Currency
var formatter = new Intl.NumberFormat('en-US', {
style: 'currency',
currency: 'USD',
});
document.getElementById('monthlyPaymentDisplay').innerText = formatter.format(monthlyPayment);
document.getElementById('loanAmountDisplay').innerText = formatter.format(loanPrincipal);
document.getElementById('taxDisplay').innerText = formatter.format(taxAmount);
document.getElementById('totalInterestDisplay').innerText = formatter.format(totalInterest);
document.getElementById('totalCostDisplay').innerText = formatter.format(totalCostOfCar);
}
Understanding Your Auto Loan Estimate
Purchasing a vehicle is a significant financial commitment, and understanding how your monthly payments are calculated is crucial for maintaining a healthy budget. This Auto Loan Payment Calculator is designed to provide a comprehensive view of your potential financing options by factoring in trade-in values, sales tax, and dealer fees—elements often overlooked in simple calculators.
How the Calculation Works
The calculation of your auto loan involves several key components:
Principal Amount: This is the amount you actually borrow. It is calculated by taking the vehicle price, subtracting your trade-in value and down payment, and adding sales tax and dealer fees.
Sales Tax & Trade-In Tax Credits: In many states, you only pay sales tax on the difference between the new car's price and your trade-in value. Our calculator applies this logic (Price – Trade-In) * Tax Rate to give you a realistic estimate of upfront costs.
Amortization: Auto loans use an amortization formula. This means your early payments cover more interest than principal, while later payments cover mostly principal.
The Impact of Loan Terms and Interest Rates
Choosing the right loan term (length of the loan) is a balancing act between monthly affordability and total cost.
Short-Term Loans (36-48 Months)
Shorter loans typically come with lower interest rates. While your monthly payment will be higher, the total interest paid over the life of the loan will be significantly lower. You will also build equity in the vehicle much faster.
Long-Term Loans (60-84 Months)
Longer terms reduce your monthly obligation, allowing you to afford a more expensive vehicle on the same monthly budget. However, beware of the long-term costs. For example, extending a loan from 60 to 84 months can nearly double the total interest paid. Additionally, you risk becoming "upside-down" on the loan, where you owe more than the car is worth, for a longer period.
Example Calculation
Let's assume you are purchasing a vehicle for $30,000. You have a trade-in worth $5,000 and want to put $2,000 down in cash. The sales tax is 7% and you secure a 5% interest rate for 60 months.