AlphaCalcs

Financial

Auto Loan Calculator

Car adverts quote a payment, not a price. Enter the real numbers — tax, trade-in, fees — and see what the vehicle actually costs you.

Applied to price minus trade-in in most US states
Start of loanEnd
Every payment is the same, but the interest share shrinks as the principal share grows.

The number the dealer shows you is the wrong one

Showroom negotiations tend to happen in monthly payments, because almost any price can be made to fit a monthly budget by lengthening the term. A $32,000 car at 7.5% is $641 a month over 60 months and $459 over 96 months — the same car, roughly $4,700 more in interest. Negotiate the price first, then the finance.

How trade-ins affect sales tax

In most US states, sales tax is charged on the price after the trade-in allowance is deducted, so a $8,000 trade-in at 7% tax saves $560 in tax on top of the $8,000 itself. A handful of states tax the full price. If yours does, enter zero in the trade-in field and subtract the value from the price instead.

Negative equity

If you still owe money on the car you are trading in, the shortfall gets rolled into the new loan. The "still owed" field adds it back, which is why the amount financed can be higher than the car's price. Rolling negative equity forward is how buyers end up owing significantly more than the vehicle is worth.

Longer terms and depreciation

A new car loses a large share of its value in the first three years, while a 72- or 84-month loan pays the balance down slowly. The two curves cross late, which means you can spend years underwater — unable to sell without writing a cheque. Shorter terms and larger deposits are the only reliable fixes. If you are weighing the finance against paying cash, the loan calculator and savings goal calculator help you compare the two paths.

Frequently asked questions

Should I take dealer finance or a bank loan?

Compare the APR on both including any fees. Manufacturer-subsidised rates can be genuinely cheaper, but they are often tied to paying full list price, so check the total cost of each package rather than the rate alone.

How much should I put down on a car?

Twenty per cent is a common benchmark because it roughly offsets first-year depreciation and keeps you from going underwater on the loan.

Does the calculator include insurance and running costs?

No. Insurance, fuel, tax and maintenance are separate and often add several hundred a month to the true cost of ownership.

Is a 84-month car loan a bad idea?

It lowers the payment but greatly increases total interest, and the car will usually be worth less than the balance for most of the term. Use it only if the alternative is a car you genuinely cannot afford.