Auto Loan Estimator
36 Months (3 Years)
48 Months (4 Years)
60 Months (5 Years)
72 Months (6 Years)
84 Months (7 Years)
Please enter valid numeric values for all fields.
Estimated Monthly Payment
$0.00
Total Loan Amount (Financed):
$0.00
Total Sales Tax:
$0.00
Total Interest Paid:
$0.00
Total Cost (Price + Tax + Interest):
$0.00
Understanding Your Car Loan Calculation
Purchasing a vehicle is one of the most significant financial commitments most people make. Using a precise Auto Loan Calculator is essential to ensure your new car fits comfortably within your monthly budget. This tool breaks down the financing costs, including sales tax, trade-in value, and interest accumulation over the life of the loan.
How This Calculator Works
Unlike simple loan calculators, this specific auto finance tool takes into account real-world variables that affect your "out-the-door" price:
- Vehicle Price: The negotiated purchase price of the car before fees.
- Trade-In & Down Payment: These upfront contributions reduce the principal amount you need to borrow, directly lowering your monthly payment and total interest paid.
- Sales Tax: In many jurisdictions, sales tax is calculated on the difference between the vehicle price and your trade-in value. This calculator adds the estimated tax to your loan balance.
- APR (Annual Percentage Rate): Your credit score largely determines this. A lower rate can save you thousands over a 5-year term.
The Impact of Loan Terms
While stretching a loan to 72 or 84 months will lower your monthly payment, it significantly increases the total interest you pay. Conversely, a 36 or 48-month term increases the monthly burden but builds equity faster and reduces overall cost.
Example Calculation
Imagine you are buying a car for $30,000 with a $5,000 down payment and a trade-in worth $2,000. If the sales tax is 6% and you secure a 5% interest rate for 60 months:
- The tax is usually applied to the price minus trade-in ($28,000 * 0.06 = $1,680).
- The total amount financed becomes roughly $24,680.
- Your monthly payment would be approximately $465.
- Over 5 years, you would pay roughly $3,260 in interest alone.
Smart Buying Tips
Financial experts generally recommend the 20/4/10 rule: put 20% down, finance for no more than 4 years, and keep total vehicle expenses (including insurance) under 10% of your gross monthly income. Use the calculator above to adjust your down payment or vehicle price to see how close you can get to this ideal scenario.