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Use an auto loan calculator to help you estimate what your monthly car loan payment will be or how much you can afford to spend.
The auto loan payment calculator delivers a monthly payment based on a price, trade-in and down payment information you supply; you can change the loan term and interest rate to see how they change your payment and total interest.
Use the auto loan payment calculator if you know what you expect to spend.
For example, perhaps you think you can afford a $20,000 loan on a new car. A 48-month loan for the most creditworthy borrowers would be 3% or less. At that rate, you'd pay about $440 a month and $1,250 in interest over the life of the loan. A subprime rate might be 11%, making the payments about $515 — and you'd pay more than $4,500 in interest.
Many people reduce payments by lengthening the term of the loan. If you change the term to 60 months, payments on that $20,000 loan at 11% fall from $515 to $435. However, you would pay nearly $6,100 in interest, or an additional $1,600, for doing so.
How to use the auto loan payment calculator
Here’s a guide for the information you will need to input into the auto loan payment calculator.
Car price: In this field, put in the price you think you’ll pay for the car. To estimate new car prices, you can start with the vehicle’s sticker price (also called the MSRP). Subtract any savings from dealer negotiations or manufacturer rebates. Then add the cost of options and the “destination fee" charged on new cars.
For used cars, estimating the sale price is a bit trickier. You can start with the seller’s asking price, but you may be able to negotiate it lower. To get an idea of a fair price, use online pricing guides or check local online classified ads for comparable cars.
Interest rate: There are several ways you can determine the interest rate to enter. At the top of the calculator, you can select your credit score on the drop down to see average car loan rates. You can also check online lenders for rates. If you get pre-qualified or preapproved for a loan, simply enter the rate you are offered.
Trade-in and down payment: Enter the total amount of cash you’re putting toward the new car, or the trade-in value of your existing vehicle, if any. You can use online sites for appraisals and pricing help. When using a pricing guide, make sure you check the trade-in value and not the retail cost (the price at which the dealer sells the car). You can also get cash purchase offers from your local CarMax, or online from services such as Vroom or Carvana, as a baseline.
Number of months: Enter the loan term (the length of time you have to pay off the loan). Car loans are in 12-month increments, with common terms being 24, 36, 48 and 60 months. The longer your term, the more you’ll pay in interest overall.
An auto loan calculator reveals more than payments
In addition to looking at the monthly car payment result, be sure to consider the total amount you'll spend on the car loan. If you're using the calculator to compare loans, a lower payment may be appealing, but it can also result in much higher interest and overall cost.
Be aware that you could have costs on top of the auto loan payment calculator's "total cost of car" result, since it does not reflect state and local taxes, dealer documentation fee (which can vary widely) and registration fees. You can search online or call the dealership and ask them for estimates of these costs in your area.
An auto loan calculator is a tool that does more than just show you a monthly car loan payment. Use it to compare lender offers and try different interest rates and loan terms. The knowledge you gain can help you negotiate with lenders and dealers and ultimately choose the best auto loan for your financial situation.
NerdWallet recommends that you shop for an auto loan before you visit dealerships; you'll give the dealer a rate to beat and won't worry that you won't be approved for loan.
Which auto loan calculator should you use?
Use a reverse auto loan calculator if you have a specific monthly payment in mind. Say you have decided that you can afford to spend $350 a month on car. Depending on the interest rate and length of loan you choose, a $350 car payment could repay a $15,600 car loan at 3.66% in 48 months or a $19,100 loan at 60 months.
Use the auto loan amortization calculator to estimate the balance of your simple interest auto loan at any point during its term.
Use the auto loan affordability calculator to determine an affordable car payment for your income and budget.
Use the auto loan refinancing calculator to compare your current loan against a new loan at a lower rate.