Car Finance Calculator

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Car Finance Calculator
Monthly PaymentLoan Amount (Affordability)
Results:
function calculateCarFinance(){var type=document.getElementById('calc_type').value;var price=parseFloat(document.getElementById('car_price').value)||0;var down=parseFloat(document.getElementById('down_payment').value)||0;var trade=parseFloat(document.getElementById('trade_in').value)||0;var rate=parseFloat(document.getElementById('interest_rate').value)||0;var term=parseFloat(document.getElementById('loan_term').value)||0;var taxCheck=document.getElementById('include_tax').checked;if(isNaN(rate)||isNaN(term)||term<=0){alert('Please enter valid numerical values');return;}if(taxCheck){price=price*1.07;}var principal=price-down-trade;if(principal<0)principal=0;var monthlyRate=(rate/100)/12;var payment=0;if(rate===0){payment=principal/term;}else{payment=(principal*monthlyRate)/(1-Math.pow(1+monthlyRate,-term));}var totalPaid=payment*term;var totalInterest=totalPaid-principal;document.getElementById('res_monthly').innerHTML='Estimated Monthly Payment: $'+payment.toFixed(2);document.getElementById('res_breakdown').innerHTML='
Total Loan Amount:$'+principal.toFixed(2)+'
' + '
Total Interest Paid:$'+totalInterest.toFixed(2)+'
' + '
Total Cost of Loan:$'+(totalPaid+down+trade).toFixed(2)+'
';}

How to Use the Car Finance Calculator

Our car finance calculator is designed to help you plan your vehicle purchase with precision. Whether you are looking at a brand-new SUV or a reliable used sedan, understanding your monthly obligations is the first step toward a smart financial decision.

To get the most accurate results, simply follow these steps:

Vehicle Price
Enter the sticker price or the negotiated price of the car before any deductions.
Down Payment & Trade-in
Input the cash you have available today and the value of your current vehicle if you are trading it in at the dealership.
Interest Rate (APR)
The Annual Percentage Rate typically depends on your credit score. Current averages range from 4% to 15%.
Loan Term
Standard auto loans are usually 36, 48, 60, or 72 months long.

How It Works: The Math Behind Your Loan

The car finance calculator uses the standard amortization formula to determine your monthly payment. This formula ensures that by the end of your loan term, your principal balance reaches zero while accounting for interest compounded monthly.

M = P [ i(1 + i)^n ] / [ (1 + i)^n – 1 ]

  • M: Total monthly payment
  • P: Principal loan amount (Car Price – Down Payment – Trade-in)
  • i: Monthly interest rate (Annual Rate / 12)
  • n: Total number of months in the loan term

Calculation Example

Scenario: You want to buy a car for $30,000. You have $4,000 for a down payment and a trade-in worth $2,000. Your bank offers a 5-year loan (60 months) at a 6% interest rate.

Step-by-step solution:

  1. Calculate Principal: $30,000 – $4,000 – $2,000 = $24,000
  2. Convert Rate: 6% Annual / 12 months = 0.005 (monthly i)
  3. Set Term: 60 months
  4. Apply Formula: $24,000 [ 0.005(1.005)^60 ] / [ (1.005)^60 – 1 ]
  5. Result: Monthly Payment = $463.99

Auto Finance Tips

Shorten Your Term if Possible

While a 72-month or 84-month loan results in lower monthly payments, you will pay significantly more in total interest. Using a car finance calculator to compare a 60-month vs. a 72-month term can reveal savings of thousands of dollars.

Don't Forget the Taxes

Most states charge sales tax on vehicle purchases. Our calculator includes a checkbox to estimate a 7% tax rate, which is often added to the final loan amount. Always verify your local tax rate before finalizing your budget.

Credit Score Impact

Your credit score is the biggest factor in determining your interest rate. Even a 1% difference in APR can change your monthly payment by $20-$50, which adds up to a substantial amount over the life of the loan.

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