How to Calculate Car Payment
What is Car Payment?
A car payment calculator determines the monthly payment for a vehicle purchase based on price, down payment, trade-in value, interest rate, and loan term. It helps you find a car that fits your budget before walking into a dealership.
Step-by-Step Guide
- 1Net loan = Vehicle price − Down payment − Trade-in value
- 2Apply monthly payment formula: PMT = P × r(1+r)ⁿ / ((1+r)ⁿ − 1)
- 3Add sales tax to the purchase price (varies by state: 0–10%)
- 4Factor in registration, documentation fees, and dealer fees
Worked Examples
Input
$35,000 car, $5,000 down, 7% APR, 60mo
Result
$594/month
$30,000 financed
Input
Same but 72 months
Result
$512/month
Lower monthly but $1,200 more total interest
Ready to calculate? Try the free Car Payment Calculator
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