Loans
Auto Loan Calculator
Figure out what a car will actually cost each month — and over the full term of the loan. Enter the vehicle price, your down payment and trade-in, APR, term length, and taxes or fees, and we'll show the monthly payment and total interest you'll pay.
Loans
Auto Loan Calculator
Result
The number on a car window sticker is only part of the story. The real cost is what you'll pay every month for the next 4 to 7 years — plus thousands in interest, taxes, and fees that don't appear on the sticker. This calculator translates a vehicle price into the monthly payment you'll actually owe, so you can spot what's affordable and what's stretching it before you sit down with a dealer.
What's happening under the hood
You enter the vehicle details and loan terms, and we run standard auto loan amortization on the financed amount:
- Vehicle price. The sticker price or negotiated price before tax and fees.
- Down payment. Cash you're putting down at signing — the more the better, both for cash-flow reasons and for staying out of negative equity.
- Trade-in value. What the dealer credits you for your old vehicle, or $0 if you're not trading anything in. Check sites like Kelley Blue Book or Edmunds for an independent estimate before negotiating.
- Sales tax. Varies by state and locality, typically 4% to 9% of the vehicle price. A few states (Oregon, Montana, New Hampshire, Delaware) charge none.
- Fees. Documentation, title, registration, and dealer prep fees usually run $300 to $700 combined.
- APR. Your loan's annual percentage rate, which depends heavily on your credit score and the lender.
- Term. Loan length in months — commonly 36, 48, 60, 72, or 84.
The financed amount equals vehicle price + tax + fees − down payment − trade-in. We amortize that amount over the term you select at the APR you enter and show you the monthly payment plus the total interest paid over the life of the loan.
Reading the result
Two numbers carry the most weight:
- Monthly payment. What you'll commit to paying every month for the term you selected. This is the figure dealers will try to anchor you on — but it's only meaningful in the context of the term and total interest.
- Total interest. The amount you'll pay above the loan principal, just for the privilege of borrowing. On a typical new-car loan, this is often $4,000 to $10,000.
A common benchmark is to keep your total monthly auto costs (loan payment + insurance + fuel + maintenance) under 15% to 20% of your take-home pay. If the monthly figure here pushes you above that, the loan is likely stretching your budget. Use our Paycheck Calculator to find your take-home pay and check the ratio.
The term length trap
Auto loan terms have stretched dramatically over the past decade. In 2019, the average new-car loan was 68 months. By 2024, it was 69+ months — with 84-month loans (seven years!) increasingly common. A longer term lowers your monthly payment, which feels great in the moment, but the math is unkind:
60 months: ~$693/month, ~$6,580 total interest.
84 months: ~$528/month, ~$9,360 total interest.
You save $165 per month in cash flow but pay an extra $2,780 in interest and remain "underwater" — owing more than the car is worth — for significantly longer. For a depreciating asset like a car, longer terms are almost always a bad trade. The 60-month maximum is a reasonable benchmark; if you can't afford a 60-month payment on a given vehicle, it's usually a sign the vehicle is more car than you can comfortably afford.
Where to focus if you want to change the result
If your monthly payment looks higher than you'd like, several approaches genuinely help — most of which don't involve stretching the loan term:
- Negotiate the vehicle price, not the monthly payment. Dealers love steering negotiations toward "what monthly payment can you afford?" because it lets them stretch the term and bury fees. Negotiate the out-the-door price first, then talk financing.
- Get pre-approved before walking in. A pre-approval from your bank or credit union gives you a baseline APR. Credit unions often beat dealer financing by 1 to 2 percentage points — and even if the dealer matches it, having the pre-approval removes their main leverage.
- Put 20% down on a new car, 10% on a used one. A real down payment offsets immediate depreciation, keeps you from being underwater, and reduces the financed amount so the monthly payment shrinks meaningfully.
- Shorten the term if you can. The shorter the loan, the less interest you pay overall — and the sooner you own the vehicle free and clear.
- Improve your credit score first. A 50-point bump in your FICO score can drop your APR by 1 to 2 percentage points, saving you thousands over the loan. Pay down credit cards, dispute errors, and avoid new credit applications in the 60 days before applying.
- Skip the F&I office add-ons. Extended warranties, paint protection, GAP insurance, and credit life insurance get bundled into the loan at the finance office — often at 200%+ markup. Decline them and buy independently if you actually want the coverage.
Where this estimate can be off
The calculator assumes several things that may not match your real situation:
- Sales tax varies. Some states tax the full vehicle price; others tax only the difference between the price and your trade-in value. Local taxes can add another 1% to 3% on top of the state rate.
- APR depends on credit and lender. The rate you'll actually qualify for is determined by your credit score, debt-to-income ratio, loan term, and the specific lender. Use ranges (e.g., 6%, 8%, 10%) to model best- and worst-case scenarios.
- Ongoing costs aren't included. Insurance, fuel, maintenance, registration renewal, and repairs after warranty can add $200 to $500 per month on top of the loan payment.
- Trade-in values are negotiable. The dealer's first trade-in offer is rarely their best. Get an independent estimate from a service like CarMax or KBB Instant Cash Offer for a baseline.
Questions readers ask
What's a good APR for an auto loan in 2026?
As of 2026, average auto loan APRs range from about 6% to 8% for new cars with strong credit (740+ FICO) and 9% to 12% or higher for used cars or borrowers with weaker credit. Anything below 5% on a new car is excellent. Above 14% is on the expensive end and worth comparison-shopping at credit unions, which often beat dealer financing by 1 to 2 percentage points.
How much should I put down on a car?
The common rule is 20% down on a new car and 10% down on a used car. A 20% down payment offsets the immediate depreciation that happens when you drive off the lot, keeps you from being underwater on the loan, and meaningfully lowers your monthly payment. A larger down payment also lets you negotiate from a stronger position and avoid lender add-ons like GAP insurance.
Is a 72-month or 84-month auto loan a bad idea?
For most borrowers, yes. Long terms (72 to 84 months) lower the monthly payment but dramatically increase total interest paid, keep you underwater on the loan longer, and often outlast the warranty on the vehicle. A 60-month maximum is the traditional benchmark. If you can't afford a 60-month payment on a given vehicle, that's usually a sign the vehicle is more car than you can comfortably afford.
Should I get pre-approved for an auto loan before going to the dealer?
Yes. Pre-approval from a bank or credit union gives you a baseline APR to compare against the dealer's financing offer, removes the leverage dealers have when negotiating financing on the spot, and lets you focus the conversation on the vehicle price rather than the monthly payment. Even if the dealer ultimately beats your pre-approved rate, having it in hand strengthens your position significantly.
Does a higher down payment lower my monthly payment a lot?
Yes, almost dollar-for-dollar on the financed amount. On a 60-month loan at 7% APR, every additional $1,000 in down payment lowers your monthly payment by roughly $20 and saves about $190 in total interest over the life of the loan. Putting an extra $5,000 down on a $35,000 vehicle saves you about $100 per month and nearly $1,000 in interest.
Should I lease or buy a car?
Buying tends to be the better long-term financial move because you eventually own the vehicle outright and stop having payments. Leasing offers lower monthly payments, more predictable maintenance costs (under warranty), and the flexibility to drive a new car every 2 to 3 years, but you pay forever. Leasing makes sense if you put low annual mileage on a vehicle, drive for business, or strongly prefer driving newer cars; buying is usually better otherwise.
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Before you act on this
WalletCalcs provides educational estimates only. Results are not financial, tax, lending, legal, or investment advice. APRs, fees, and tax rates vary by lender, state, and credit profile. Always confirm important decisions with the appropriate professional or your lender directly.