How to use this tool
- Choose your currency and enter the amount you plan to borrow.
- Type the yearly interest rate your lender quoted and the length of the loan in years.
- Your monthly payment shows at once, with the total interest and a year-by-year schedule below.
Term length matters more than people expect
Stretching a car loan from 5 to 7 years lowers the monthly payment, but you pay interest for longer and may owe more than the car is worth for several years, because cars lose value quickly. Many guides suggest keeping car loans to 5 years or less.
Before you sign
Compare the APR, not just the monthly figure, and get a quote from your bank or credit union before visiting the dealer. Add sales tax, registration and fees to the amount borrowed if you are financing them.
Frequently asked questions
How is a car loan payment calculated?
With the standard amortization formula using the loan amount, monthly rate and number of months.
Is 72 or 84 months too long for a car loan?
It lowers payments but raises total interest and the risk of owing more than the car is worth.
Does this include sales tax?
No. Add tax and fees to the loan amount if you're financing them.
Need more detail? See the full Loan & Mortgage Calculator guide.
Sources and references
- Consumer Financial Protection Bureau: What is amortization?
- Reserve Bank of India: Fair Practices Code on EMI loans
- MoneyHelper (UK): Mortgage calculator guidance