Purchasing a vehicle is one of the largest financial commitments most people make, second only to buying a home. Our Auto Loan Calculator helps you estimate monthly payments, visualize the impact of interest rates, and determine the affordability of your next car.
How Interest Rates (APR) Affect Your Payment
The Annual Percentage Rate (APR) on your car loan significantly impacts your monthly obligations. A lower credit score often results in a higher APR, increasing the total cost of the vehicle. For example, on a $30,000 loan over 60 months, the difference between a 4% and 9% interest rate can cost you thousands of dollars over the life of the loan.
The Importance of a Down Payment
Putting money down upfront reduces the principal loan amount. This has two major benefits:
Lower Monthly Payments: Borrowing less means paying less each month.
Reduced Gap Risk: A larger down payment prevents you from becoming "upside-down" on your loan (owing more than the car is worth) as soon as you drive off the lot.
Loan Term: 60 Months vs. 72 Months vs. 84 Months
While stretching your loan term to 72 or 84 months can lower your monthly payment, it drastically increases the total interest paid. Additionally, longer terms increase the likelihood of negative equity, where your car depreciates faster than you can pay off the balance. Financial experts generally recommend keeping auto loan terms to 60 months or fewer whenever possible.
What About Sales Tax?
Don't forget to factor in state sales tax. In many states, sales tax is calculated on the vehicle price minus your trade-in value, providing a tax incentive to trade in your old vehicle rather than selling it privately. This calculator estimates tax based on the vehicle price to give you a conservative estimate of your "out-the-door" price.
function calculateAutoLoan() {
// 1. Get DOM elements
var vehiclePriceInput = document.getElementById('vehiclePrice');
var downPaymentInput = document.getElementById('downPayment');
var tradeInInput = document.getElementById('tradeInValue');
var salesTaxInput = document.getElementById('salesTax');
var interestRateInput = document.getElementById('interestRate');
var loanTermInput = document.getElementById('loanTerm');
var resultsSection = document.getElementById('resultsSection');
var errorDisplay = document.getElementById('errorDisplay');
var monthlyPaymentDisplay = document.getElementById('monthlyPaymentDisplay');
var totalLoanDisplay = document.getElementById('totalLoanDisplay');
var totalInterestDisplay = document.getElementById('totalInterestDisplay');
var totalCostDisplay = document.getElementById('totalCostDisplay');
// 2. Parse Values (Handle empty inputs as 0)
var price = parseFloat(vehiclePriceInput.value) || 0;
var down = parseFloat(downPaymentInput.value) || 0;
var trade = parseFloat(tradeInInput.value) || 0;
var taxRate = parseFloat(salesTaxInput.value) || 0;
var interestRate = parseFloat(interestRateInput.value) || 0;
var months = parseInt(loanTermInput.value) || 60;
// 3. Validation
if (price <= 0) {
errorDisplay.style.display = 'block';
errorDisplay.innerHTML = "Please enter a valid vehicle price.";
resultsSection.style.display = 'none';
return;
}
errorDisplay.style.display = 'none';
// 4. Calculations
// Calculate Tax Amount (Using simple calculation: Tax on Price)
// Note: Some states tax (Price – TradeIn). We will use Price * Tax for a conservative estimate.
var taxAmount = price * (taxRate / 100);
// Calculate Amount Financed (Principal)
// Principal = (Price + Tax) – Down Payment – Trade In
var principal = (price + taxAmount) – down – trade;
if (principal <= 0) {
errorDisplay.style.display = 'block';
errorDisplay.innerHTML = "Your Down Payment and Trade-In cover the cost of the vehicle. No loan required.";
resultsSection.style.display = 'none';
return;
}
var monthlyPayment = 0;
var totalInterest = 0;
if (interestRate === 0) {
// Simple division if 0% financing
monthlyPayment = principal / months;
totalInterest = 0;
} else {
// Standard Amortization Formula: A = P * (r(1+r)^n) / ((1+r)^n – 1)
var monthlyRate = (interestRate / 100) / 12;
var mathPower = Math.pow(1 + monthlyRate, months);
monthlyPayment = principal * ((monthlyRate * mathPower) / (mathPower – 1));
totalInterest = (monthlyPayment * months) – principal;
}
var totalCost = price + taxAmount + totalInterest;
// 5. Update UI with formatted numbers
monthlyPaymentDisplay.innerHTML = formatCurrency(monthlyPayment);
totalLoanDisplay.innerHTML = formatCurrency(principal);
totalInterestDisplay.innerHTML = formatCurrency(totalInterest);
totalCostDisplay.innerHTML = formatCurrency(totalCost);
// Show results
resultsSection.style.display = 'block';
}
function formatCurrency(num) {
return new Intl.NumberFormat('en-US', { style: 'currency', currency: 'USD' }).format(num);
}