Your monthly car payment is not just the sticker price divided by the loan term. It is the amount you actually finance — after your down payment and trade-in, plus sales tax and fees — spread across the term at your APR. This calculator shows how each of those pieces moves the payment, and why a 72-month loan can feel cheaper while costing you more.
How the payment is built
The calculator first works out the amount financed: the vehicle price, minus your down payment and trade-in equity, plus sales tax and fees, plus any negative equity rolled in from a car you still owe on. It then applies the standard amortization formula to spread that principal across the loan term at your APR. Each monthly payment covers that month's interest first, and whatever is left chips away at the principal.
Why term and APR matter most
Two inputs dominate the result: the term and the APR. Stretching a loan from 60 to 72 months lowers the monthly payment but adds a full year of interest, so total interest rises even though each payment is smaller. A higher APR compounds that effect. The Early Loan Payoff Calculator shows how extra payments can claw some of that interest back.
Trade-ins, tax, and fees
A trade-in does double duty: it lowers the amount you finance and, in most states, lowers the taxable price because tax is charged on price minus trade-in value. If you still owe on the trade, that balance becomes negative equity and is added to the new loan. Title, registration, and dealer document fees are usually financed too, so they quietly raise the payment. Rules vary by state — confirm the tax treatment and fees on your own contract.