How It Works
The amount you finance is the vehicle price minus your down payment and trade-in value. This calculator applies the standard amortization formula to that amount to find a fixed monthly payment.
Sales tax and fees aren't included here since they vary by state and are often rolled into the amount financed differently depending on the dealer — add them to the vehicle price first if you want them reflected in the loan amount.
Formula
- M — Monthly payment
- P — Amount financed (price − down payment − trade-in)
- i — Monthly interest rate (annual rate ÷ 12)
- n — Loan term in months
Example
Example inputs: Vehicle price $32,000, down payment $4,000, no trade-in, 6.9% APR, 60-month term.
Result: Amount financed: $28,000.00. Monthly payment: $553.11. Total interest over the loan: $5,186.81. Total of all payments: $33,186.81.
Frequently Asked Questions
Should I include sales tax in the vehicle price?
If you want the payment to reflect tax and fees, add your estimated sales tax and fees to the vehicle price before entering it, since rates vary by state and sometimes by county.
How does a trade-in affect my payment?
A trade-in reduces the amount you need to finance in the same way a down payment does, which lowers both your monthly payment and total interest paid.
Is a shorter loan term always better?
A shorter term means a higher monthly payment but less total interest paid, since you're borrowing the money for less time. A longer term lowers the monthly payment but increases total interest.
This calculator provides estimates for informational purposes only and should not be considered financial, tax, or legal advice.