Calculate your monthly car payments and see how extra payments can save you money and time.
Standard Monthly Payment:
—
Total Paid (with extra payments):
—
Total Interest Paid (with extra payments):
—
Time to Pay Off (Years and Months):
—
Understanding Your Car Loan Payments
Financing a car is a significant financial decision, and understanding your loan payments is crucial. This calculator helps you determine your standard monthly payment, and more importantly, shows the impact of making extra payments. By paying a little extra each month, you can significantly reduce the total interest paid and pay off your car loan much faster.
How the Calculation Works
The standard monthly car payment is calculated using the following formula:
M = P [ i(1 + i)^n ] / [ (1 + i)^n – 1]
Where:
M = Your total monthly loan payment
P = The principal loan amount (the amount you borrowed for the car)
i = Your monthly interest rate (annual interest rate divided by 12)
n = The total number of payments over the loan's lifetime (loan term in years multiplied by 12)
The Power of Extra Payments
When you make extra payments, that additional amount goes directly towards reducing your principal loan balance. This has a compounding effect:
Reduced Principal: A lower principal balance means less interest accrues over time.
Shorter Loan Term: By paying down the principal faster, you reach a zero balance sooner, effectively shortening your loan term.
Significant Interest Savings: The combination of a lower principal and a shorter term leads to substantial savings on the total interest paid over the life of the loan.
Using This Calculator
To use the calculator:
Enter the total amount of your car loan (principal).
Input the annual interest rate offered by your lender.
Specify the loan term in years.
Enter any additional amount you plan to pay each month above the standard payment. Even a small extra amount can make a big difference!
The calculator will then show you:
Standard Monthly Payment: The payment required without any extra contributions.
Total Paid (with extra payments): The total amount you will have paid by the end of the loan, including your extra payments.
Total Interest Paid (with extra payments): The total interest paid over the life of the loan, after accounting for your extra payments.
Time to Pay Off: The new, shorter duration it will take to pay off your car loan.
Use this tool to plan your car purchase wisely and find ways to save money on your auto financing.
function calculateCarLoan() {
var loanAmount = parseFloat(document.getElementById("loanAmount").value);
var annualInterestRate = parseFloat(document.getElementById("annualInterestRate").value);
var loanTerm = parseFloat(document.getElementById("loanTerm").value);
var extraPayment = parseFloat(document.getElementById("extraPayment").value);
var monthlyPaymentSpan = document.getElementById("monthlyPayment");
var totalPaidSpan = document.getElementById("totalPaid");
var totalInterestSpan = document.getElementById("totalInterest");
var timeToPayoffSpan = document.getElementById("timeToPayoff");
// Clear previous results
monthlyPaymentSpan.innerText = "–";
totalPaidSpan.innerText = "–";
totalInterestSpan.innerText = "–";
timeToPayoffSpan.innerText = "–";
// Input validation
if (isNaN(loanAmount) || loanAmount <= 0 ||
isNaN(annualInterestRate) || annualInterestRate < 0 ||
isNaN(loanTerm) || loanTerm <= 0 ||
isNaN(extraPayment) || extraPayment 0) {
standardMonthlyPayment = loanAmount * (monthlyInterestRate * Math.pow(1 + monthlyInterestRate, numberOfPayments)) / (Math.pow(1 + monthlyInterestRate, numberOfPayments) – 1);
} else {
standardMonthlyPayment = loanAmount / numberOfPayments; // Simple division if interest is 0
}
// Format standard monthly payment for display
monthlyPaymentSpan.innerText = "$" + standardMonthlyPayment.toFixed(2);
// Calculate with extra payments
var remainingBalance = loanAmount;
var totalPaid = 0;
var totalInterestPaid = 0;
var numberOfPaymentsMade = 0;
var currentMonth = 0;
while (remainingBalance > 0) {
currentMonth++;
numberOfPaymentsMade++;
var interestForMonth = remainingBalance * monthlyInterestRate;
var principalPayment = 0;
var paymentThisMonth = standardMonthlyPayment + extraPayment;
// Ensure payment covers interest and reduces principal
if (paymentThisMonth (loanTerm * 12 * 5)) { // Safety break after 5x original term
alert("Loan may not be payable with these extra payments. Check your inputs.");
return;
}
principalPayment = paymentThisMonth – interestForMonth;
} else {
principalPayment = paymentThisMonth – interestForMonth;
}
// Ensure principal payment does not exceed remaining balance
if (principalPayment > remainingBalance) {
principalPayment = remainingBalance;
paymentThisMonth = remainingBalance + interestForMonth; // Adjust final payment
}
remainingBalance -= principalPayment;
totalPaid += paymentThisMonth;
totalInterestPaid += interestForMonth;
}
// Format results
totalPaidSpan.innerText = "$" + totalPaid.toFixed(2);
totalInterestSpan.innerText = "$" + (totalPaid – loanAmount).toFixed(2);
// Calculate time to pay off
var yearsToPayoff = Math.floor((currentMonth -1) / 12);
var monthsToPayoff = (currentMonth -1) % 12;
timeToPayoffSpan.innerText = yearsToPayoff + " years, " + monthsToPayoff + " months";
}