Car Loan Calculator
The average new car loan in the US is $40,290 over 68 months according to Experian data. Enter your loan amount, interest rate, and term to see monthly payments, total interest, and total cost. Compare different loan lengths and down payments side by side to find the best deal.
Last updated: May 2026
An auto loan finances the purchase of a vehicle by spreading the cost over monthly payments plus interest. Monthly Payment = [Loan Amount × Monthly Rate × (1 + Monthly Rate)^Months] ÷ [(1 + Monthly Rate)^Months − 1]. APR typically target Below 5%.
📊 Your visitors see this on your website. Dealerships and automotive businesses embed this tool — visitors compare options and you capture their vehicle preferences. See plans →
↑ This is exactly what your website visitors see when you embed this tool. The only difference: their results are gated behind an email capture form, and every input is sent to your CRM.
What is Car Loan?
An auto loan finances the purchase of a vehicle by spreading the cost over monthly payments plus interest. Understanding the total cost of borrowing — not just the monthly payment — is essential for making a financially sound vehicle purchase. Compare with total ownership costs using the Vehicle Cost Calculator.
The Formula
Monthly Payment = [Loan Amount × Monthly Rate × (1 + Monthly Rate)^Months] ÷ [(1 + Monthly Rate)^Months − 1]
Monthly Rate = Annual Rate ÷ 12. Total Interest = (Monthly Payment × Number of Months) − Loan Amount.
Worked Example
A $30,000 car with a $5,000 down payment, leaving a $25,000 loan at 6.5% APR over 5 years (60 months).
- Loan amount = $30,000 − $5,000 = $25,000
- Monthly rate = 6.5% ÷ 12 = 0.542%
- Monthly payment = $489
- Total repaid = $489 × 60 = $29,340
- Total interest = $29,340 − $25,000 = $4,340
📌 Monthly payments of $489 over 5 years, with $4,340 in total interest — 17.4% of the loan amount. The car actually costs $34,340 including interest and down payment.
Why This Matters
Total cost awareness
Dealers emphasize monthly payments ("only $399/month!") to distract from the total cost. A lower monthly payment over a longer term means more interest. Always calculate the total amount repaid before committing.
Depreciation overlap
Cars depreciate 15-30% in year one and 45-55% over 3 years. If your loan term exceeds the car's depreciation curve, you may owe more than the car is worth (negative equity). This creates problems if you need to sell or trade in early.
Common Mistakes
❌ Extending the term to reduce payments
A 7-year loan reduces monthly payments but you pay interest for 2 extra years. On a $25,000 loan at 6.5%, extending from 5 to 7 years saves $90/month but adds $2,200 in total interest.
❌ Not comparing finance types
Dealer financing, bank loans, and credit union loans have different rates and total costs. Credit unions often offer rates 1-2% lower than dealers, and getting pre-approved strengthens your negotiating position.
Industry Benchmarks
| Category | Good | Average | Poor |
|---|---|---|---|
| APR | Below 5% | 5-8% | Above 10% |
| Total interest as % of loan | Below 15% | 15-25% | Above 30% |
Source: Experian State of the Auto Finance Market & AAA Your Driving Costs Report
Benchmark data sourced from Experian State of the Auto Finance Market & AAA Your Driving Costs Report.
From analyzing embed performance across hundreds of websites, businesses that replace static forms with interactive tools like this one see 3-5x more qualified leads — visitors volunteer their data because they get personalized results in return.
One of the most common mistakes we see when working with clients: extending the term to reduce payments. A 7-year loan reduces monthly payments but you pay interest for 2 extra years. On a $25,000 loan at 6.5%, extending from 5 to 7 years saves $90/month but adds $2,200 in total interest.
Embed This Calculator on Your Website
Every visitor who uses your embedded calculator becomes a qualified lead. Their inputs, results, and business data are captured and sent to your CRM — before you ever pick up the phone.
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