Cars & VehiclesAmortization Engine
Auto Loan Calculator
Calculate monthly auto loan payments, total financing interest charges, and overall loan payoff costs with trade-in credits, down payments, dealer fees, and sales tax.
Auto Loan Financing Details
Financing Summary
Monthly Payment
$524.28/mo
60 payments at 5.50% APR
Total Amount Financed$27,450.00
Sales Tax Owed$1,950.00
Total Financing Interest$4,006.80
Total Loan Payments$31,456.80
Fixed-Rate Auto Loan Amortization Formula
Monthly Payment = P ร [ r(1 + r)^n ] / [ (1 + r)^n โ 1 ] (or P / n when r = 0%)- P (Principal Financed): Vehicle Price + Sales Tax + Fees โ Down Payment โ Net Trade Credit.
- r: Monthly interest rate (Annual APR / 12 / 100).
- n: Total loan term length in months (e.g. 36, 48, 60, 72).
- Zero Interest Case: When APR is 0.0%, monthly payment equals Principal divided exactly by n.
Step-by-Step Worked Example
Scenario: Financing a $30,000 car with $5,000 down payment at 5.5% APR for 60 months
Calculation Steps:
- Total Financed Principal = $30,000 + $1,950 + $500 โ $5,000 = $27,450.00
- Monthly Rate (r) = 5.5% / 12 = 0.004583
- Monthly Payment = $27,450 ร [ 0.004583(1.004583)^60 ] / [ (1.004583)^60 โ 1 ] = $524.28
- Total Paid over 60 Months = $524.28 ร 60 = $31,456.80
- Total Financing Interest = $31,456.80 โ $27,450.00 = $4,006.80
Result: The monthly payment is $524.28. Total finance interest paid across the 5-year loan is $4,006.80.
How to Use This Calculator
- 1Enter the vehicle purchase price.
- 2Input your cash down payment and trade-in value (plus any amount still owed on the trade).
- 3Specify the state sales tax rate and dealership documentation fees.
- 4Select your loan term in months and approved interest rate (APR).
Assumptions & Limitations
- Assumes a standard fixed-rate amortizing loan with equal monthly installments.
- Sales tax is calculated after deducting trade-in value, matching tax laws in the majority of US states.
Frequently Asked Questions
Is a 72-month or 84-month car loan a good idea?
While 72- and 84-month loans lower your monthly payment, they significantly increase total interest paid and keep you underwater (owing more than the car is worth) for years. Sticking to 48 or 60 months is generally recommended.
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