How the calculator works
- The amount you borrow: the car price, plus sales tax and any fees you add to the loan, less your down payment and trade-in. The sales tax calculator has your state’s rate.
- Your monthly payment: worked out so equal payments repay the loan, with interest, by the end of the loan.
- The real cost: everything you pay, up front and in repayments. The chart below shows how much of each year’s payments goes on interest.
Payments by loan amount and length
Borrowing at 7.54%, the payment a month:
| Borrow | 36 months | 48 months | 60 months | 72 months |
|---|---|---|---|---|
| $20,000 | $622.49 | $483.95 | $401.14 | $346.19 |
| $30,000 | $933.74 | $725.93 | $601.71 | $519.28 |
| $40,000 | $1,244.98 | $967.90 | $802.28 | $692.38 |
On a $35,000 car with $3,500 down, over 60 months, you'd borrow $31,500, pay $631.79 a month and $6,408 in interest: the car costs you $41,408 in all, before sales tax, fees and insurance.
New 60-month car loans at banks averaged 7.54% in August 2026, according to the Federal Reserve. The rate you’re offered depends on your credit history, the lender, the car’s age and the loan length, so use your own rate for the most accurate result.
Loan length makes a big difference
A longer loan lowers each payment but you pay interest for longer, so the car costs more in all. Long loans also mean you can owe more than the car is worth for years, which matters if you sell or trade it in early. Choose the shortest loan whose payment fits your budget comfortably.
Before you buy
- Set your budget first. A common guide is to keep car payments to about 10% of your take-home pay. The car affordability calculator works out a price from your pay.
- Get a rate before you go to the dealer. A pre-approval from a bank or credit union gives you a rate to compare with the dealer’s own finance offer.
- Put more down. A bigger down payment or a trade-in shrinks the loan and the interest.
- Pay tax and fees up front if you can, so you don’t pay interest on them.
- Budget for the rest: insurance, fuel, repairs and registration add to the cost every month.
Thinking of leasing instead? Compare the two in the lease vs buy calculator. Your credit score affects the rate you’re offered: see credit scores explained.