How to estimate your car payment
Fill in the vehicle price, your down payment, any trade-in value, your state’s sales tax rate, and the title and registration fees the dealer quotes. Then enter the interest rate you’ve been offered and pick a term. The calculator shows the monthly payment, the amount financed, and the total interest you’ll pay. The comparison table underneath recalculates the payment for every common term so you can see what stretching the loan actually costs.
How the numbers are built
- Sales tax is applied to the price minus the trade-in (the rule in most states).
- Amount financed = price + tax + fees − down payment − trade-in.
- The monthly payment uses the standard amortization formula, the same one banks use for every fixed-rate loan.
Worked example
A $35,000 car with $5,000 down, 7% sales tax, $500 in fees, at 7.5% APR over 60 months:
- Sales tax: $2,450
- Amount financed: $32,950
- Monthly payment: $660.24
- Total interest: $6,664
Choosing 72 months drops the payment to about $569 but raises total interest to roughly $8,050. Choosing 48 months raises the payment to about $797 and cuts interest to around $5,300.
Before you sign
- Get pre-approved by a bank or credit union first. Dealer financing is convenient but often carries a higher rate — a pre-approval gives you a number to beat.
- Negotiate the price, not the payment. Dealers can hit any monthly figure by lengthening the term or adding products.
- Watch the add-ons. Extended warranties, GAP insurance and paint protection are often rolled into the loan and charged interest.
- Keep the term at or under 60 months if you can. Cars depreciate quickly; with a long loan and a small down payment you can owe more than the car is worth for years.
- Aim for 20% down on a new car. It absorbs the first-year depreciation drop and usually earns a better rate.
New vs used
Used-car loans typically carry rates 1–3 percentage points higher than new-car loans, but the lower price usually means a lower payment overall. Run both scenarios here with the rates you’ve actually been quoted.
Frequently asked questions
Is sales tax charged on the full price or after trade-in?
In most US states sales tax applies to the price minus your trade-in value, which is what this calculator assumes. A few states (for example California and Virginia) tax the full price. Check your state's rule if the trade-in is large.
What's a good interest rate for a car loan?
It depends on credit score and whether the car is new or used. In 2026, borrowers with excellent credit see rates around 5–7% on new cars; used-car rates run higher, and subprime rates can exceed 15%.
Should I take a longer term to get a lower payment?
A longer term lowers the monthly payment but costs more in total interest and increases the time you owe more than the car is worth. The comparison table shows both numbers so you can judge the trade-off.
What does "amount financed" mean?
It's the loan principal — price plus tax and fees, minus your down payment and trade-in. It's the number the interest is charged on.
Last updated August 26, 2026.