Auto Loan Calculator
Estimated Monthly Payment
$0.00
Amortization Schedule
| Month | Payment | Principal | Interest | Balance |
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Understanding Your Auto Loan
Our auto loan calculator helps you understand the costs associated with financing a new or used car. By entering a few key details, you can see your estimated monthly payment and the total cost of the loan over its lifetime. This information is crucial for budgeting and making an informed financial decision.
Key Terms Explained
- Vehicle Price: The sticker price or negotiated price of the car you wish to purchase.
- Down Payment: The initial amount of money you pay upfront. A larger down payment reduces your loan amount and can lower your monthly payments.
- Trade-in Value: The value of the car you are trading in, which is also deducted from the total price.
- Annual Interest Rate (APR): The annual rate charged for borrowing money. A lower APR results in lower interest costs.
- Loan Term: The length of time you have to repay the loan, typically in months. Longer terms mean lower monthly payments but more total interest paid.
- Sales Tax: The tax applied to the vehicle's purchase price, which is often included in the loan.
How is the Monthly Payment Calculated?
The calculator uses a standard formula to determine your monthly payment based on the total loan amount, interest rate, and loan term. The total loan amount is calculated as: `(Vehicle Price + (Vehicle Price * Sales Tax %)) - Down Payment - Trade-in Value`. The monthly payment consists of two parts: principal (the amount that goes toward paying down your loan balance) and interest (the cost of borrowing the money).