Auto Loan Calculator
Calculate monthly car payments, total cost, and compare financing options for vehicle purchases.
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How to Use This Calculator
- Enter the total car purchase price
- Input your down payment amount (recommended 20% or more)
- Add any trade-in value from your current vehicle
- Enter the annual interest rate offered by your lender
- Specify the loan term in years (typically 3-6 years)
- Click 'Calculate' to see your monthly payment and total costs
Formula
M = P[r(1+r)^n]/[(1+r)^n-1], where M = monthly payment, P = loan amount (car price - down payment - trade-in), r = monthly interest rate, n = number of monthly payments
Frequently Asked Questions
How much should I put down on a car loan?▼
Financial experts typically recommend putting down at least 20% of the car's purchase price. This helps you avoid being upside down on the loan (owing more than the car is worth) and reduces your monthly payments and total interest paid.
What is a good interest rate for a car loan?▼
As of 2024, good auto loan rates range from 3% to 6% for new cars and 4% to 8% for used cars, depending on your credit score. Excellent credit (720+) typically qualifies for the best rates. Rates vary based on loan term, vehicle age, and lender.
Should I trade in my old car or sell it privately?▼
Selling privately often yields more money but requires more effort. Trading in is more convenient and can reduce sales tax in some states. Compare offers from dealerships with private sale estimates to make the best decision.
What loan term should I choose?▼
Shorter loan terms (36-48 months) mean higher monthly payments but less total interest. Longer terms (60-72 months) have lower payments but you'll pay significantly more in interest and risk being upside down longer. Choose the shortest term you can comfortably afford.