Car Payment Calculator

How to use this calculator

Enter the vehicle price, any down payment, the annual interest rate (APR) your lender quoted, and the loan term in months. Press Calculate payment and the tool shows your fixed monthly payment, the total interest you will pay over the life of the loan, and the total cost including the down payment. Adjusting any field updates the picture — raising the down payment or shortening the term lowers the interest, while a longer term lowers the monthly payment but costs more overall. It is a quick way to compare offers before signing.

The formula explained

Car loans use standard amortization. With principal P (price minus down payment), monthly rate r (annual rate ÷ 12 ÷ 100) and n months, the monthly payment M is:

M = P · r · (1 + r)ⁿ / ((1 + r)ⁿ − 1)

This formula spreads the loan so that every payment is identical, even though early payments are mostly interest and later ones are mostly principal. The total of all payments is M × n; subtract the amount borrowed and you get the total interest. When the interest rate is zero, the formula simplifies to the principal divided evenly across the term. The calculator handles both cases automatically.

A worked example

Suppose a car costs $28,000 with a $4,000 down payment, an APR of 7.5% over 60 months. The amount financed is $24,000. The monthly rate is 0.625%. Running the formula gives a monthly payment of about $481, a total interest of roughly $4,840, and a total cost (with the down payment) near $32,840. Enter your own figures above to see the exact numbers for your deal.

Frequently asked questions

How is a monthly car payment calculated?

With the amortization formula, which spreads the financed amount plus interest into equal monthly payments based on the monthly interest rate and number of months.

Does a bigger down payment lower the payment?

Yes — it reduces the amount financed before interest is applied, lowering both the monthly payment and the total interest.

What counts as total interest?

The sum of every payment minus the amount you actually borrowed — the cost of financing on top of the car itself.