Auto Loan Calculator
A $35,000 car with $4,000 down and an $8,000 trade-in, plus 7% sales tax and $1,000 of fees rolled into the loan, costs $518.78 a month at 7.5% APR for 60 months, with $5,236.95 of interest. The calculator also shows the amount financed and the car's total cost.
By the Calculators With Steps team · Updated November 10, 2026 · How we check our math
- Amount financed
- $25,890.00
- Sales tax
- $1,890.007% of $27,000 (price minus trade-in)
- Total interest
- $5,236.95
- Total of loan payments
- $31,126.95
- Paid up front
- $4,000.00down payment
- Total cost (price, tax, fees, interest)
- $43,126.95
- Loan-to-value
- 74%amount financed ÷ vehicle price
- Vehicle price$35,000.00
- Sales tax & fees$2,890.00
- Interest$5,236.95
- Principal
- Interest
Step-by-step working
- Taxable amount = $35,000.00 price − $8,000.00 trade-in = $27,000.00
- Sales tax = $27,000.00 × 7% = $1,890.00
- Amount financed = $35,000.00 − $4,000.00 down − $8,000.00 trade-in equity + $2,890.00 tax & fees = $25,890.00
- Payment = P × r(1 + r)^n ÷ ((1 + r)^n − 1), r = 7.5% ÷ 12 = 0.00625, n = 60
- Payment = $25,890.00 × 0.00625 × 1.453294 ÷ (1.453294 − 1) = $518.78
Compare loan terms
| Term | Monthly payment | Total interest | Total of payments |
|---|---|---|---|
| 36 months | $805.34 | $3,102.24 | $28,992.24 |
| 48 months | $625.99 | $4,157.61 | $30,047.61 |
| 60 months | $518.78 | $5,236.95 | $31,126.95 |
| 72 months | $447.64 | $6,340.15 | $32,230.15 |
| 84 months | $397.11 | $7,467.07 | $33,357.07 |
Show yearly amortization schedule
| Year | Principal paid | Interest paid | Balance at year end |
|---|---|---|---|
| 1 | $4,434.00 | $1,791.39 | $21,456.00 |
| 2 | $4,778.22 | $1,447.17 | $16,677.77 |
| 3 | $5,149.17 | $1,076.22 | $11,528.60 |
| 4 | $5,548.91 | $676.48 | $5,979.69 |
| 5 | $5,979.69 | $245.70 | $0.00 |
Estimate only. Sales tax rules, dealer fees and rebates vary by state and dealer. Your Truth in Lending disclosure shows the exact APR and finance charge.
How to use the auto loan calculator
- Vehicle price – the negotiated price before tax and fees.
- Down payment – cash you put down, plus any manufacturer rebate applied at signing.
- Trade-in value and amount owed – what the dealer gives you for your old car and the payoff on its loan. If you owe more than it is worth, the calculator rolls the negative equity into the new loan.
- Sales tax rate – your state plus local rate where the car will be registered.
- Title, registration and dealer fees – documentation fees, plates and title transfer.
- APR and term – from your loan offer. Terms run from 36 to 84 months.
- Checkboxes – choose whether to finance the tax and fees, and whether your state taxes the full price.
How the car payment is calculated
The calculator follows the same order a dealer’s finance office does:
- Taxable amount = price − trade-in allowance (or the full price where there is no trade-in credit)
- Sales tax = taxable amount × tax rate
- Amount financed = price − down payment − (trade-in value − amount owed) + tax and fees if financed
- Monthly payment = P × r(1 + r)^n ÷ [(1 + r)^n − 1], where P is the amount financed, r = APR ÷ 12 and n = number of months
Most states tax the price after subtracting the trade-in, which is why a trade-in is often worth more to you at a dealer than in a private sale. California is one of the few exceptions. Its tax agency treats the trade-in allowance as part of the taxable selling price.
Worked example
A $35,000 car, $4,000 down, an $8,000 trade-in that is paid off, 7% sales tax, $1,000 in fees, 7.5% APR for 60 months, with tax and fees financed:
| Item | Amount |
|---|---|
| Taxable amount ($35,000 − $8,000) | $27,000.00 |
| Sales tax at 7% | $1,890.00 |
| Amount financed | $25,890.00 |
| Monthly payment | $518.78 |
| Total interest | $5,236.95 |
| Total cost (price, tax, fees, interest) | $43,126.95 |
The loan-to-value ratio is 74%, which most lenders like because the car is worth more than the loan from day one.
Compare auto loan terms
Longer terms are now common, but they cost more. For the same $25,890 at 7.5%:
| Term | Monthly payment | Total interest |
|---|---|---|
| 36 months | $805.34 | $3,102.24 |
| 48 months | $625.99 | $4,157.61 |
| 60 months | $518.78 | $5,236.95 |
| 72 months | $447.64 | $6,340.15 |
| 84 months | $397.11 | $7,467.07 |
Going from 36 to 84 months cuts the payment by more than half but more than doubles the interest. Lenders often charge a higher APR on longer terms too, which widens the gap. Long loans also raise the risk of being “upside down”, owing more than the car is worth if it is totaled or you want to sell.
Ways to lower your car payment
- Get preapproved. A quote from your bank or credit union gives you a benchmark. Dealers can arrange financing, but the rate may include a markup.
- Negotiate the price first. Settle the out-the-door price before discussing monthly payments.
- Put more down or pay tax and fees in cash. In the example, paying $2,890 of tax and fees up front saves $584.58 in interest.
- Pay off negative equity first if you can, instead of rolling it into a new loan.
- Check your budget. The debt-to-income ratio calculator shows how a new payment affects your overall debt load.
For a general personal loan, use the loan calculator. To see every month’s split between principal and interest, enter the amount financed in the amortization calculator. To work out tax on another purchase, try the sales tax calculator.
Auto Loan Calculator: frequently asked questions
How do you calculate an auto loan payment?
First work out the amount financed: price minus down payment minus trade-in equity, plus sales tax and fees if you finance them. Then apply Payment = P × r(1 + r)^n ÷ ((1 + r)^n − 1) with r = APR ÷ 12. Financing $25,890 at 7.5% for 60 months gives $518.78 a month.
Does a trade-in lower the sales tax on a car?
In most states, yes. Tax is charged on the price minus the trade-in allowance. On a $35,000 car with an $8,000 trade-in at a 7% rate, tax is $1,890 instead of $2,450, a saving of $560. A few states, including California, tax the full price, and private-party sales usually get no credit.
Should I choose a 60-month or 72-month car loan?
A 72-month loan lowers the payment but costs more. On $25,890 at 7.5%, 60 months costs $518.78 a month and $5,236.95 in interest, while 72 months costs $447.64 a month and $6,340.15 in interest. Longer loans also leave you owing more than the car is worth for longer.
What happens if I owe more on my trade-in than it is worth?
The difference, called negative equity, is usually added to the new loan. Owing $10,000 on a car worth $8,000 adds $2,000, so the example loan grows to $35,890, the payment rises to $719.16 and you start out owing 102.5% of the new car's price.
How do I calculate auto loan per diem interest?
Per diem is the daily interest: balance × APR ÷ 365. On a $25,890 balance at 7.5%, that is about $5.32 a day. Lenders use it to calculate a payoff amount between payment dates.
What is a good APR for a car loan?
It depends on your credit score, the term and whether the car is new or used. The Federal Reserve's G.19 release reported an average of 7.54% for 60-month new car loans at commercial banks in the third quarter of 2026. Getting a preapproval from a bank or credit union gives you a rate to compare with the dealer's offer.
Is it better to pay sales tax and fees up front?
Paying them in cash means you do not pay interest on them. In the example, paying the $2,890 of tax and fees up front cuts the loan to $23,000, the payment to $460.87 and total interest by $584.58.
How we checked this page: every figure in the examples and FAQs above is produced by this calculator and verified by automated tests against known answers, and the rules and rates come from the sources below. Last updated . Spotted a problem? Tell us.