Enter the car price, your down payment and the rate you were offered. You’ll see your monthly payment, total interest, and how much a shorter or longer loan would change the bill.
How your car payment is calculated
First the calculator works out how much you are borrowing: the price plus sales tax and fees, minus your down payment and trade-in. Then it applies the standard loan payment formula used by banks and dealers.
P = amount financed, r = APR ÷ 12, n = number of months
Worked example: a $45,000 car
With 6% sales tax ($2,700), $800 in fees and $5,000 down, you finance $43,500. At 6.35% APR for 72 months, the payment is about $728 a month and total interest is about $8,925. Stretch the same loan to 84 months and the payment drops to about $643, but interest climbs to about $10,495.
Average car loan rates in 2026
According to Experian’s State of the Automotive Finance Market report for the second quarter of 2026, the average rate was 6.35% for new-car loans and 11.19% for used-car loans. Your credit score moves your rate the most:
| Borrower | New car average APR |
|---|---|
| Super prime (best credit) | 4.41% |
| All borrowers | 6.35% |
| Deep subprime (poorest credit) | 16.11% |
Used-car rates ranged from about 6.29% for the best credit to 21.62% for the poorest in the same report. The average new-car payment was $765 a month, and new-car loans averaged about 69 months.
How to lower what you pay
- Get pre-approved first. A rate from your bank or credit union gives you something to beat at the dealership.
- Put more down. Every dollar you don’t borrow saves you the interest on it, and it protects you from owing more than the car is worth.
- Keep the term short. The chart above shows how total interest grows with each extra year.
- Negotiate the price, not the payment. A low monthly payment can hide a longer loan and a higher total cost.
A popular rule of thumb is 20/4/10: put 20% down, finance for no more than 4 years, and keep total car costs under 10% of your gross income. It is a guideline, not a law, but it keeps car costs from crowding out savings.
Frequently asked questions
What is a good APR for a car loan right now?
Anything at or below the average for your credit tier is competitive. For new cars in Q2 2026, that meant roughly 4.4% for excellent credit and 6.35% overall.
Is sales tax included in my car loan?
Often, yes. Many buyers roll tax and fees into the loan, which is how this calculator treats them. Paying them upfront lowers the amount you finance.
Does a trade-in reduce sales tax?
In most states the trade-in value is deducted before tax is calculated, which is what this calculator assumes. A few states tax the full price.
Should I lease instead?
Leases have lower payments because you pay for the car’s depreciation, not its full value. Experian reported an average lease payment of $617 in Q2 2026, versus $765 for a new-car loan. But at the end of a lease you own nothing.
Source: Experian, State of the Automotive Finance Market, Q2 2026. This calculator gives estimates for planning only; your lender’s figures are final.
