How to Calculate Your Auto Loan
Enter the vehicle price in the Vehicle Price field.
Enter the annual interest rate offered by your lender.
Select the loan term from the dropdown (24 to 84 months).
Optionally enter a down payment, trade-in value, sales tax percentage, and any additional fees.
Click Calculate to see your monthly payment, total interest, and full cost breakdown.
How the Auto Loan Calculator Works
The calculator uses the standard loan amortization formula to compute your fixed monthly payment. It first determines the loan principal — vehicle price, minus your down payment and trade-in value, plus sales tax (if provided) and any other fees. It then applies the monthly interest rate (annual rate divided by 12) over the selected number of months to produce a monthly payment that fully pays off the loan by the final installment. From there it derives total interest (total paid minus principal) and total cost of the vehicle (price plus tax plus fees plus total interest).
Step-by-Step Example
- Vehicle price: 28,000. Down payment: 4,000. Trade-in: 3,000. Sales tax: 8%. Fees: 600.
- Sales tax amount: 28,000 × 8% = 2,240.
- Loan principal: 28,000 − 4,000 − 3,000 + 2,240 + 600 = 23,840.
- Annual rate 6.5%, term 60 months → monthly rate r = 6.5 / 12 / 100 = 0.005417.
- Monthly payment: 23,840 × [0.005417 × (1.005417)^60] / [(1.005417)^60 − 1] ≈ 465.61.
- Total paid on loan: 465.61 × 60 = 27,936.60. Total interest: 27,936.60 − 23,840 = 4,096.60.
- Total cost of vehicle: 28,000 + 2,240 + 600 + 4,096.60 = 34,936.60.
When to Use This Calculator
- Comparing loan offers with different rates, terms, or down-payment amounts.
- Estimating your budget before visiting a dealership.
- Understanding how a trade-in or larger down payment reduces your monthly payment and total interest.
- Seeing the full cost of financing vs. paying cash.
- Preparing documentation for a loan application or personal records.
- Evaluating the impact of a shorter vs. longer loan term on total interest paid.
Important Note
Results are estimates based on fixed-rate simple amortization. They do not account for variable rates, prepayment penalties, dealer markups, title and registration fees beyond what you enter, or regional tax rules that differ from the full-price convention used here. Always confirm final terms with your lender before signing.
Shorter Term vs. Longer Term
Key Features
Accurate Monthly Payment Formula
Uses the standard amortization formula M = P[r(1+r)^n]/[(1+r)^n-1] to compute your exact monthly payment based on principal, rate, and term.
Full Cost Breakdown
Shows total loan amount, total interest paid over the life of the loan, and the all-in cost including taxes and fees — not just the monthly figure.
Visual Cost Breakdown Chart
A pie chart illustrates how your total outlay is split between vehicle price, interest, sales tax, and fees — making it easy to see the real cost of financing.
PDF Export
Download a formatted PDF summary of your loan calculation for your records or to share with a lender.
Privacy & Security
All calculations run entirely in your browser using JavaScript. No values are sent to any server, stored, or logged. It is safe to use with personal financial details.
Frequently Asked Questions
What formula is used to calculate the monthly payment?
The standard loan amortization formula: M = P × [r(1+r)^n] / [(1+r)^n - 1], where P is the principal (loan amount), r is the monthly interest rate (annual rate / 12 / 100), and n is the number of months. If the interest rate is 0%, the payment is simply P divided by n.
How is the loan principal calculated?
Principal = Vehicle Price − Down Payment − Trade-In Value + Sales Tax + Fees. The sales tax is calculated on the full vehicle price before subtracting down payment or trade-in.
Why is sales tax applied to the full vehicle price?
In many regions, sales tax is assessed on the sticker price of the vehicle before any credits. The calculator follows this common convention, but the exact rule varies by location. Check with your dealer or tax authority for your region's rules.
What is the total cost of the vehicle?
Total Cost = Vehicle Price + Sales Tax + Fees + Total Interest Paid. This represents the full amount you pay for the vehicle over the life of the loan, compared to paying cash (Vehicle Price + Sales Tax + Fees).
Can I use this for any currency?
Yes. No currency symbol is assumed. Enter values in any currency and interpret the results accordingly.