Car Payment Calculator
Figure out your monthly car payment before you hit the dealership. Enter the vehicle price, your down payment, trade-in value, interest rate, and loan term to see exactly what you will owe each month.
Your monthly car payment depends on four main factors: the vehicle price, what you put toward the purchase upfront (down payment plus trade-in), the interest rate, and the loan term. The standard amortization formula is M = P[r(1+r)^n] / [(1+r)^n - 1], where P is the principal, r is the monthly interest rate, and n is the number of payments.
For example, a $35,000 car with $3,000 down and a $5,000 trade-in leaves $27,000 to finance. At 6.5% APR for 60 months, the monthly payment comes out to about $528. Over the full loan, you will pay roughly $4,688 in interest, making the total cost $31,688.
To keep your monthly payment manageable, financial experts suggest keeping total transportation costs (payment, insurance, gas, maintenance) under 15-20% of your take-home pay. A larger down payment or shorter loan term directly reduces total interest. Even adding $1,000 to your down payment on a 60-month loan at 6.5% saves about $70 in interest and drops the monthly payment by roughly $20.