A car payment depends on the amount borrowed, the interest rate and the term. Build the amount borrowed from the purchase details first: include financed taxes and extras, subtract cash and trade-in value, then add the payoff on the vehicle you are trading.
This US-dollar calculator estimates a fixed-rate loan with monthly payments. Enter your actual tax and fee amounts; local rules and trade-in tax treatment vary. Starting figures illustrate the calculation and are not market prices or rate quotes.
Estimate the purchase loan
Build the financed amount line by line
Principal = vehicle price + financed taxes/fees + financed extras + trade-in payoff − trade-in value − cash down. Enter only the amounts actually included in this loan. If your vehicle price already includes taxes or an extra, remove that amount from the corresponding separate field.
Use the negotiated purchase price and an itemized purchase worksheet. Enter rebates applied to the purchase as part of the cash-down reduction, once. Expenses paid entirely outside the loan belong in your separate cash budget. Zero is appropriate for an absent trade-in or an extra you declined.
Get the payoff as well as the trade-in value
A lender's payoff quote can differ from the balance on a statement. Obtain a dated quote and compare it with the written trade-in offer. If payoff exceeds value, the difference is negative equity. Rolling that difference into a new loan increases the amount borrowed and the interest cost. The CFPB trade-in guide explains the comparison and checking that the old loan is actually paid.
Try a second scenario without the negative-equity amount to see its effect. That comparison is a way to understand cost, not an assumption that the debt disappears. If you decide to wait, use a fresh payoff and vehicle valuation when you next compare offers.
Compare term lengths with the same purchase
Keep the principal and rate fixed, then try 48, 60 and 72 months. Record monthly payment, total interest and total repayment for each. The CFPB auto-offer guidance recommends comparing amount financed, APR, interest rate and term alongside the payment.
A lower payment can be the result of a longer obligation. Decide how the full cost and the expected period of ownership fit your budget. If a dealer changes the price, adds a product or changes the down payment while discussing a monthly target, rerun the calculation from the itemized figures.
This model calculates interest monthly on the remaining balance. Actual auto contracts can use daily simple interest or precomputed interest; those arrangements respond differently to payment timing and early payoff. See the CFPB explanation of simple and precomputed auto interest. Compare the lender's schedule with the model rather than treating this estimate as a payoff quote.
Add the costs of owning the car
The loan payment is one line in the transport budget. Price insurance for the actual vehicle, then estimate fuel or charging, maintenance, repairs, registration, parking and tolls. Keep these ongoing costs outside the financed purchase fields unless a specific charge is actually rolled into the loan.
Before signing, compare the final contract with your saved worksheet: purchase price, trade-in credit, old-loan payoff, cash down, extras, principal, rate/APR, term and payment. Ask about prepayment charges and how extra payments are applied. Keep a copy of the final documents.
For a clean balance/rate/term comparison use the general loan calculator. If current debt already strains the budget, use the repayment planning guide before adding another payment.
US guidance reviewed October 6, 2026. Explore loans, credit and debt guides.