How it works
Auto loans use the same amortization math as mortgages: fixed monthly payments split between interest and principal. A bigger down payment or shorter term always saves interest.
Monthly payment = P × r(1+r)n / ((1+r)n − 1)
Watch out for long 84-month loans — the payment looks small but you pay far more interest and risk owing more than the car is worth.
Frequently asked questions
What is a good APR for a car loan?
It depends on credit score and year. As a rough guide: excellent credit 5–7%, fair credit 8–12%, poor credit 13%+ (rates move with the market).
How much down payment should I make?
20% is the classic advice — it covers immediate depreciation so you never owe more than the car is worth.
Is a longer loan term bad?
72–84 month terms lower the payment but cost much more interest. If you need 84 months to afford it, the car may be too expensive.
Disclaimer: This calculator provides estimates for educational purposes only and is not financial, tax, or legal advice. Consult a qualified professional before making financial decisions.