What is APR and how is credit card interest calculated?
APR is the annual percentage rate on credit. Learn the types of credit card APR, how APR becomes daily interest, the grace period, and how APR differs from APY.
Auto loan calculator
Estimate the monthly payment on a new or used car with down payment, trade-in, sales tax, fees and APR. See the total interest and the total cost of the car.
Fix the highlighted fields to see your result.
Estimated monthly payment—
- Amount financed
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- Sales tax
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- Total interest
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- Total of payments
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- Total cost of the car
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How it is calculated
First, the amount you finance:
Financed = Price + Tax + Fees − Down payment − Trade-in
Then the monthly payment with the standard amortization formula, where r = APR ÷ 12 and n = number of months:
Payment = Financed × r ÷ (1 − (1 + r)^−n)
Assumptions and limitations
- Tax is applied to price minus trade-in; some states calculate it differently.
- Fees are financed with the car. If you pay them in cash, set them to zero.
- Does not include insurance, extended warranties or add-on products a dealer may offer.
- Your actual APR depends on your credit, the vehicle and the lender.
This tool is educational and provides estimates. It is not a credit offer or financial advice. Actual terms are set by each institution.
How to lower the cost of a car loan
- Get a preapproved offer from your bank or credit union before you negotiate at the dealer.
- Negotiate the price of the car separately from the monthly payment and the trade-in.
- A larger down payment and a shorter term reduce total interest.
- Read the contract: check the APR, the amount financed and any add-on products before you sign.
Frequently asked questions
How is a car payment calculated?
The amount financed (price + sales tax + fees − down payment − trade-in) is spread over the loan term with the standard amortization formula, using the APR divided by 12 as the monthly rate.
Is a 72- or 84-month car loan a good idea?
A longer term lowers the monthly payment but raises the total interest, and you may owe more than the car is worth for longer. Compare the total cost, not only the payment.
Is sales tax charged on the full price if I trade in a car?
In many states, sales tax is charged on the price minus the trade-in value, but rules vary by state. This calculator applies the tax to price minus trade-in; check your state rules.
Should I compare the dealer offer with my bank or credit union?
Yes. The CFPB recommends getting preapproved offers before visiting the dealer so you can compare the APR and the total cost of the loan.