Loan Parameters
Calculation Results
Visualizations
Loan Schedule (Equal Payment)
| Period | Payment ($) | Principal ($) | Interest ($) | Balance ($) |
|---|
View Calculation Formula
Monthly payment (equal payment): M = P·r·(1+r)n / ((1+r)n − 1), where P = loan principal (vehicle price − down payment), r = annual rate / 12, n = term in years × 12; total interest = M·n − P.
Down payment: vehicle price × down payment %.
Sales tax: vehicle price × sales tax rate.
Insurance: user input, or vehicle price × 3% by default.
Total cost of ownership: down payment + sales tax + insurance + total of all monthly payments.
Amounts use integer cents internally to avoid floating-point errors.
Auto Loan FAQ & Tips
How is auto loan payment calculated? Equal payment
The monthly payment uses the amortization formula M = P·r·(1+r)n / ((1+r)n − 1). The loan principal P is the vehicle price minus the down payment. Each monthly payment stays fixed; the interest portion shrinks each month while the principal portion grows, so the loan is fully paid off by the last period.
What is a good down payment for a car? 10-20% recommended
A down payment of 10% to 20% is generally recommended. Putting at least 20% down on a new car (and 10% on a used car) helps you avoid being "upside down" on the loan (owing more than the car is worth), lowers your monthly payment, reduces total interest, and may help you qualify for better rates.
Should I finance or pay cash? Compare rates
Compare the loan interest rate to the return you could earn by investing that cash. If the auto loan rate is lower than your expected investment return, financing can leave you ahead. If the loan rate is higher than your likely investment return, paying cash usually saves more. Also consider dealer incentives: a low or 0% APR offer can make financing attractive even when you could pay cash.
Typical auto loan rates (2026 reference)
- New car — banks/credit unions: ~5% - 8% APR
- Used car — banks/credit unions: ~6% - 10% APR
- Captive lender (manufacturer) promo: 0% - 5% APR on select models
- Buy-here-pay-here / subprime: 12% - 20%+ APR
Note: rates vary by credit score, lender, and market. Final APR is set by the lender; this calculator is for reference only.