Estimate your monthly car payments and total cost based on the car price, your upfront cash, and the loan terms.
Your estimated monthly payment will appear here.
Understanding Your Car Purchase Affordability
Buying a car is a significant financial decision. This calculator helps you estimate the monthly payments and total cost associated with financing a vehicle, enabling you to make a more informed choice. By inputting the car's price, the cash you plan to pay upfront, the desired loan term, and the annual interest rate, you can get a clear picture of your potential financial commitment.
How the Calculation Works
The calculator uses the standard formula for calculating the monthly payment (M) of a loan:
M = P [ i(1 + i)^n ] / [ (1 + i)^n – 1]
Where:
P is the principal loan amount. This is calculated by subtracting your upfront cash (down payment) from the total car price.
i is the monthly interest rate. This is derived by dividing the annual interest rate by 12 (months). For example, a 6% annual rate becomes 0.005 per month (6 / 12 / 100).
n is the total number of payments, which is the loan term in months.
The calculator first determines the loan principal (P) by taking the Car Price and subtracting the Upfront Cash. It then converts the Annual Interest Rate into a monthly rate (i) and uses the Loan Term (Months) as 'n' in the formula.
Key Inputs Explained:
Car Price ($): The total advertised or agreed-upon price of the vehicle before any financing.
Upfront Cash ($): The amount of money you are paying out-of-pocket at the time of purchase. This reduces the amount you need to borrow.
Loan Term (Months): The duration over which you will repay the loan. Longer terms generally mean lower monthly payments but more interest paid over time.
Annual Interest Rate (%): The yearly interest rate charged by the lender. This is a critical factor that significantly impacts your total repayment amount. A lower rate means less interest paid.
Why This Matters
Understanding your potential monthly car payments helps you:
Budget Effectively: Ensure the car payment fits comfortably within your monthly budget without causing financial strain.
Compare Offers: Evaluate different loan offers from various lenders by comparing their interest rates and terms.
Avoid Overspending: Prevent purchasing a vehicle that is beyond your financial reach, both in terms of initial cost and ongoing expenses.
Remember that this calculator provides an estimate. Actual loan terms, fees, taxes, and other charges can affect the final monthly payment and total cost. Always consult with your lender for precise figures.
function calculateCarAffordability() {
var carPrice = parseFloat(document.getElementById("carPrice").value);
var downPayment = parseFloat(document.getElementById("downPayment").value);
var loanTermMonths = parseInt(document.getElementById("loanTermMonths").value);
var annualInterestRate = parseFloat(document.getElementById("annualInterestRate").value);
var resultDiv = document.getElementById("result");
resultDiv.style.color = "#333"; // Reset color
// Input validation
if (isNaN(carPrice) || carPrice <= 0) {
resultDiv.textContent = "Please enter a valid Car Price.";
return;
}
if (isNaN(downPayment) || downPayment < 0) {
resultDiv.textContent = "Please enter a valid Upfront Cash amount.";
return;
}
if (isNaN(loanTermMonths) || loanTermMonths <= 0) {
resultDiv.textContent = "Please enter a valid Loan Term in months.";
return;
}
if (isNaN(annualInterestRate) || annualInterestRate < 0) {
resultDiv.textContent = "Please enter a valid Annual Interest Rate.";
return;
}
var loanPrincipal = carPrice – downPayment;
if (loanPrincipal 0) {
monthlyInterestRate = (annualInterestRate / 100) / 12;
}
var monthlyPayment = 0;
if (loanPrincipal > 0 && monthlyInterestRate > 0 && loanTermMonths > 0) {
// Calculate monthly payment using the loan payment formula
var numerator = monthlyInterestRate * Math.pow(1 + monthlyInterestRate, loanTermMonths);
var denominator = Math.pow(1 + monthlyInterestRate, loanTermMonths) – 1;
monthlyPayment = loanPrincipal * (numerator / denominator);
} else if (loanPrincipal == 0) {
monthlyPayment = 0; // If no loan is needed, monthly payment is 0
} else if (loanTermMonths > 0) {
// Handle case with 0% interest rate for simplicity
monthlyPayment = loanPrincipal / loanTermMonths;
} else {
resultDiv.textContent = "Cannot calculate with the provided inputs.";
return;
}
var totalCost = (monthlyPayment * loanTermMonths) + downPayment;
var totalInterestPaid = totalCost – carPrice;
if (isNaN(monthlyPayment) || isNaN(totalCost) || isNaN(totalInterestPaid)) {
resultDiv.textContent = "Calculation error. Please check your inputs.";
return;
}
// Format numbers for display
var formattedMonthlyPayment = monthlyPayment.toFixed(2);
var formattedTotalCost = totalCost.toFixed(2);
var formattedTotalInterestPaid = totalInterestPaid.toFixed(2);
resultDiv.innerHTML = `
Estimated Monthly Payment: $${formattedMonthlyPayment}
Total Paid Over Loan Term: $${formattedTotalCost}
Total Interest Paid: $${formattedTotalInterestPaid}
`;
resultDiv.style.color = "#28a745"; // Success green for results
}