Auto Loan Calculator
Calculate your US car loan monthly payment from the vehicle price, down payment, trade-in value, sales tax, interest rate, and loan term.
Calculation Summary
Breakdown Amortization Schedule
| Year | Total Payment | Principal Repaid | Interest Charges | Ending Balance |
|---|---|---|---|---|
| Year 1 | $5,898 | $4,119 | $1,779 | $25,121 |
| Year 2 | $5,898 | $4,395 | $1,503 | $20,726 |
| Year 3 | $5,898 | $4,689 | $1,209 | $16,037 |
| Year 4 | $5,898 | $5,003 | $895 | $11,034 |
| Year 5 | $5,898 | $5,338 | $560 | $5,696 |
| Year 6 | $5,898 | $5,696 | $203 | $0 |
How a US Auto Loan Payment Is Calculated
Your monthly payment is based on the amount financed, not the vehicle's sticker price. The amount financed starts with the vehicle price, subtracts your down payment and trade-in value, then adds back sales tax — which most states charge only on the price net of your trade-in credit. Once you know the amount financed, the payment uses the same reducing-balance formula as any amortizing loan: Payment = P × r × (1+r)ⁿ / ((1+r)ⁿ − 1), where P is the amount financed, r is the monthly interest rate (APR ÷ 12 ÷ 100), and n is the loan term in months.
Worked Example
A $35,000 vehicle, with $5,000 down and a $3,000 trade-in, at a 7% sales tax rate (applied after the trade-in credit) and a 6.5% APR over 72 months:
- Taxable amount = $35,000 − $3,000 trade-in = $32,000
- Sales tax (7%) = $2,240
- Amount financed = $35,000 − $5,000 − $3,000 + $2,240 = $29,240
- Monthly payment (72 months @ 6.5% APR) = $492
- Total interest over the loan = $6,150
Monthly Payment by Loan Term ($29,240 Financed at 6.5% APR)
| Term | Monthly Payment | Total Interest | Total Cost |
|---|---|---|---|
| 36 months | $896 | $3,022 | $32,262 |
| 48 months | $693 | $4,044 | $33,284 |
| 60 months | $572 | $5,087 | $34,327 |
| 72 months | $492 | $6,150 | $35,390 |
| 84 months | $434 | $7,233 | $36,473 |
Going from 36 to 84 months roughly halves the monthly payment but more than doubles total interest paid. Use the calculator above for your exact numbers.
Frequently Asked Questions (FAQ)
Is sales tax charged on the full vehicle price or after my trade-in?
It depends on your state. Most states (including Texas, Florida, Georgia, and about 40 others) apply sales tax only to the price after your trade-in credit is subtracted — trading in a $10,000 car against a $35,000 purchase means tax applies to $25,000, not $35,000. A handful of states (including California, and a few others) tax the full purchase price regardless of trade-in. Check your state DMV or revenue department before relying on this calculator's default.
What is a typical auto loan interest rate right now?
As of early-to-mid 2026, Experian reports a credit-weighted average of about 6.4% APR for new-car loans and roughly 11.4% for used-car loans. Your actual rate depends heavily on credit score: Experian's data shows roughly 4.6% for superprime borrowers, 6.2% for prime, 9.7% for nonprime, and into the mid-teens for subprime credit.
Should I choose a 72-month or 84-month loan term?
A longer term lowers your monthly payment but increases total interest paid, and raises the risk of being "underwater" (owing more than the car is worth) for longer, since cars depreciate faster than a long loan amortizes. The average new-car loan term was about 69-70 months in early 2026. A shorter term (48-60 months) costs more per month but less overall and builds equity faster — worth the tighter budget if you can manage it.
Does my trade-in value reduce my loan amount or just my sales tax?
Both. Your trade-in value is first subtracted directly from the vehicle price (like a down payment), and in most states it also reduces the taxable amount, lowering your sales tax bill too. That double effect is why a trade-in is usually worth more toward lowering your loan than the same amount as extra cash down, state tax rules considered.
What other costs should I budget for besides the loan payment?
This calculator covers the loan itself — price, trade-in, tax, and financing. On top of that, budget for: title and registration fees (varies by state, often $50-$300), a documentation ("doc") fee charged by the dealer (commonly $100-$600), and ongoing costs like insurance, which often rises for a newer or financed vehicle since lenders require full coverage.
Buying a car in India instead? Use our Car EMI Calculator for on-road price, reducing vs flat rate comparisons, and INR-based examples.