Auto Loan Calculator: How to Finance a Car the Smart Way
Financing a car is the second-largest purchase most people make. Understanding how auto loans work can save you thousands over the life of your loan...
Auto Loan Calculator
Calculate your monthly car payment with trade-in, taxes, and fees
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Formula
Formula
M = P[r(1+r)^n]/[(1+r)^n-1] where P = vehicle price + tax + fees - trade-in - down payment
The loan amount is adjusted for trade-in value, sales tax (on the difference), dealer fees, and down payment.
How to Calculate Manually
- 1 Determine the vehicle price and your trade-in value
- 2 Subtract what you owe on trade-in from its value
- 3 Calculate sales tax on (vehicle price - net trade-in)
- 4 Add dealer fees to get total cost
- 5 Subtract trade-in equity and down payment
- 6 Apply the loan payment formula to the financed amount
- 7 Multiply payment by term for total cost
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Reference Table
| Credit Score | New Car APR | Used Car APR |
|---|---|---|
| 781-850 (Super Prime) | 5.0-6.5% | 6.5-8.5% |
| 661-780 (Prime) | 6.5-9.5% | 8.5-11.5% |
| 601-660 (Near Prime) | 9.5-14% | 11.5-17% |
| 501-600 (Subprime) | 14-19% | 17-22% |
| 300-500 (Deep Subprime) | 19-25%+ | 22-28%+ |
Frequently Asked Questions
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Should I finance through the dealer or my bank?
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How does trade-in value affect my loan?
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What's a good down payment for a car?
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