Calculate your car loan payments, total interest, and total cost to make informed financing decisions
An auto loan is a secured loan used to purchase a vehicle. The car serves as collateral, typically offering lower interest rates than unsecured loans. Payments are made monthly over a set term.
Understanding your monthly payment, total interest, and loan terms helps you budget effectively, compare financing options, and negotiate better deals with dealers or lenders.
New car loans typically offer lower rates (2-6% APR), used car loans range 4-10% APR, and refinancing options are available. Credit unions often provide competitive rates.
Calculators provide estimates based on basic inputs. Actual rates depend on credit score, debt-to-income ratio, down payment, and lender policies. Always verify with lenders.
Financial advisors use auto loan calculators to help clients determine affordable payment ranges, compare financing options, and understand the total cost of vehicle ownership.
Monitor your loan balance, track payment history, and consider refinancing options when rates drop. Extra payments toward principal can significantly reduce total interest paid.
A larger down payment reduces monthly payments and total interest paid over the loan term
Credit scores above 720 typically qualify for the best auto loan interest rates
Shorter loan terms mean higher monthly payments but significantly less interest paid overall
Most lenders require a minimum credit score of 600-650 for auto loans. Scores above 720 qualify for the best rates, while scores below 600 may require specialized subprime lenders with higher rates.
Compare both options. Banks and credit unions often offer competitive rates, while dealers may have promotional financing. Get pre-approved from your bank to negotiate from a position of strength.
A 10-20% down payment is recommended for new cars, 20% for used cars. This reduces monthly payments, total interest, and helps avoid being underwater on the loan if the car depreciates quickly.
While longer terms (72-84 months) offer lower monthly payments, they result in more interest paid and potential negative equity. 36-60 months is typically optimal for balancing payment size and total cost.
Most auto loans allow early payoff without penalties. Making extra principal payments or paying biweekly can save significant interest. Check your loan agreement for any prepayment penalties.
Buying builds equity and offers long-term savings, while leasing provides lower monthly payments and newer vehicles. Consider your driving habits, budget, and preference for vehicle ownership.
Credit score, loan term, down payment amount, debt-to-income ratio, vehicle age, and current market rates all influence your APR. New cars typically qualify for better rates than used vehicles.
Trade-in value is applied as a down payment toward your new vehicle. Research your car's value using KBB or Edmunds, and consider selling privately if the trade-in offer is significantly below market value.
Consider refinancing if interest rates have dropped, your credit score has improved, or you need to lower monthly payments. Ensure the savings outweigh any refinancing fees and consider the remaining loan term.
"This calculator helped me budget for my first car purchase. The payment breakdown and total cost analysis were exactly what I needed to negotiate confidently at the dealership!"
"Compared financing options from multiple lenders using this tool. Saved me over $2,000 in interest by choosing a shorter loan term. The amortization breakdown is incredibly useful!"
"Perfect for refinancing calculations! I was able to determine if refinancing my current auto loan would save money. The results were spot-on with my lender's quotes."
"As a financial advisor, I recommend this calculator to all my clients looking to purchase vehicles. The accuracy and detailed breakdown make it an excellent planning tool."
"Used this to plan my budget before car shopping. Knowing my exact monthly payment range helped me stay focused and avoid overspending. Great tool for financial discipline!"
"The trade-in value feature is fantastic! I could see exactly how my current car's value would affect my new loan. Made the whole car buying process much clearer."