Car Payment Calculator
Calculate your monthly car payment with our free auto loan calculator. Enter the loan amount, interest rate, and loan term to get an accurate monthly payment estimate.
Enter Your Loan Details
20.0% of vehicle price
Loan Summary
Your Payment Results
Enter your loan details to see your payment results
How to Use Our Car Payment Calculator
Our car payment calculator helps you estimate your monthly auto loan payment before you visit the dealership. This tool is essential for budgeting and ensuring you can afford your desired vehicle.
What You Need to Calculate Car Payments:
- Vehicle Price: The total cost of the car you want to purchase
- Down Payment: The amount you'll pay upfront (typically 10-20% of vehicle price)
- Loan Amount: Vehicle price minus down payment
- Interest Rate: Annual percentage rate (APR) from your lender
- Loan Term: Length of the loan in months (typically 36-84 months)
Car Payment Formula:
Monthly Payment = P × (r × (1 + r)^n) / ((1 + r)^n - 1)
Where: P = Principal loan amount, r = Monthly interest rate (APR ÷ 12), n = Total number of payments
Tips for Lower Car Payments:
- Make a larger down payment to reduce the loan amount
- Shop around for the best interest rates
- Consider a longer loan term (though this increases total interest)
- Improve your credit score before applying for a loan
- Consider buying a less expensive vehicle
Understanding Your Results:
The calculator shows your estimated monthly payment, total interest paid over the loan term, and the total amount you'll pay. Remember that actual payments may vary based on your credit score, lender requirements, and any additional fees or charges.
Frequently Asked Questions About Car Payments
How do I calculate my monthly car payment?
Monthly car payments are calculated using the loan amount, interest rate, and loan term. The formula considers principal and interest, with payments typically remaining the same throughout the loan. Our calculator uses the standard auto loan formula to give you accurate monthly payment estimates.
What is a good interest rate for a car loan in 2024?
Good car loan rates in 2024 range from 3% to 7% for borrowers with excellent credit (720+). Rates vary based on credit score, loan term, and lender. Subprime borrowers may see rates of 10% or higher. Our calculator helps you see how different rates affect your monthly payment.
How much should I put down on a car?
A 20% down payment is recommended to avoid negative equity and reduce monthly payments. However, many buyers put down 10-15%. Larger down payments mean lower monthly payments and less total interest. Our calculator shows how different down payments affect your payment amount.
What is the 20/4/10 rule for car buying?
The 20/4/10 rule suggests: 20% down payment, 4-year loan term maximum, and car expenses (payment + insurance + gas) should not exceed 10% of your gross monthly income. This helps ensure the car is truly affordable. Our calculator helps you apply this rule to your situation.
How does loan term affect monthly payments?
Longer loan terms (5-7 years) result in lower monthly payments but higher total interest costs. Shorter terms (3-4 years) have higher monthly payments but lower total costs. Our calculator shows the trade-off between monthly affordability and total loan cost.
What is the difference between APR and interest rate?
The interest rate is the cost of borrowing money, while APR includes the interest rate plus other loan costs like origination fees and processing charges. APR gives you the true cost of the loan. Our calculator uses APR for more accurate payment calculations.
Can I afford a car payment on my salary?
Car payments should typically not exceed 10-15% of your gross monthly income. Consider your other expenses, debt obligations, and emergency savings. Our Car Affordability Calculator can help determine what car payment fits your budget.
What happens if I miss a car payment?
Missing payments can result in late fees, credit score damage, and potential repossession after multiple missed payments. Contact your lender immediately if you're having trouble making payments. They may offer payment deferment or modification options.