Car Loan Calculator 2026
Calculate your exact monthly payment, total interest, and true vehicle cost including tax, trade-in, and fees.
How Car Loan Payments Are Calculated
Your monthly car loan payment is determined by three factors: the loan amount (vehicle price + tax − down payment − trade-in), the interest rate (APR), and the loan term. The formula is identical to any amortizing loan: M = P × r(1+r)^n / [(1+r)^n − 1].
The 20/4/10 Rule
A widely used guideline: put at least 20% down, finance for no more than 4 years, and keep total vehicle expenses (payment + insurance) under 10% of gross monthly income. Following this rule prevents being underwater on your loan and keeps car costs from dominating your budget.
New vs Used Car Loan Rates (2026)
New car rates: 5%–9% for good credit. Used car rates: typically 2%–4% higher than new because used cars depreciate faster, increasing lender risk. Credit unions offer rates 1%–2% below bank rates on average. Always get pre-approved before visiting a dealership.
Trade-In Strategy
Trade-in value reduces your loan amount directly. Get your trade-in appraised separately (Carmax, Carvana) before visiting the dealer — dealers often lowball the trade-in to make up margin elsewhere. Selling privately almost always yields more money than a dealer trade-in.