How to estimate your car payment
Sales tax, fees, your trade-in, any loan still owed on it and the loan length all change what you borrow and repay. This calculator combines them the way a lender does.
How to use it
- Enter the negotiated Vehicle price, your Down payment and any Cash rebate or incentive.
- If you are trading in a car, enter its Trade-in value and the Amount owed on trade-in. If you owe more than it is worth, the difference is added to the new loan.
- Add your Sales tax rate and the Title, registration and dealer fees from the buyer's order.
- Type the Interest rate (APR) from your pre-approval or offer and pick a Loan term.
- Untick Include sales tax and fees in the loan if you will pay them at signing, and untick the trade-in tax box if your state taxes the full price.
The formula
Amount financed = price - rebate - down payment - (trade-in value - amount owed) + sales tax and fees if financed. Sales tax is the tax rate times the price, less the trade-in where your state allows it. The monthly payment uses the standard installment loan formula:
M = P x r / (1 - (1 + r)-n)
P is the amount financed, r is the APR divided by 12 and n is the number of months. The CFPB's auto loan guide explains how these terms appear on a loan contract.
Worked example
With the starting numbers, a $35,000 car with $5,000 down and an $8,000 trade-in is taxed on $27,000, so sales tax at 7% is $1,890. The amount financed is $35,000 - $5,000 - $8,000 + $1,890 = $23,890. At 6.5% APR for 60 months the payment is $467.44, the total of payments is $28,046 and total interest is $4,156. Counting the down payment and trade-in, the car costs $41,046 in all. Stretching the same loan to 84 months drops the payment to $354.75 but raises interest to $5,909.
Limits and edge cases
- Tax rules differ. A few states, such as California, tax the full price even with a trade-in, and many tax the price before a manufacturer rebate, as this calculator does. Check with your state's motor vehicle or revenue agency.
- Rolling negative equity into a new loan raises the payment and the risk of owing more than the car is worth.
- The schedule assumes on-time payments on a simple-interest loan. Add dealer extras such as GAP coverage to fees if you are buying them.
- Thinking about leasing instead? Use the lease vs buy car calculator. To see how extra payments shorten the loan, try the loan payoff calculator, and check the debt-to-income calculator before you apply.
Frequently asked questions
What is a good interest rate for a car loan in 2026?
It depends mostly on your credit. Experian's data for the second quarter of 2026 shows average rates of 6.35% for new cars and 11.19% for used cars. Borrowers with super prime scores (781 and up) averaged 4.41% new and 6.29% used, while subprime borrowers (501 to 600) averaged 13.52% new and 19.10% used.
Does a trade-in reduce the sales tax on a car?
In most states, yes: you pay tax on the price minus the trade-in value. With a $35,000 car and an $8,000 trade-in you are taxed on $27,000. A few states, including California, tax the full price, so untick the trade-in tax box if that applies to you.
Is it better to pay sales tax up front or roll it into the loan?
Paying tax and fees at signing lowers the amount financed, so you pay less interest. Rolling them in keeps more cash in your pocket today but adds interest over the whole term.
Should I choose a 72 or 84 month car loan?
Only if it is the only way the car fits your budget. Longer loans usually carry higher rates, cost more interest and leave you owing more than the car is worth for longer. Check the total interest column above.
Sources: Experian, average car loan interest rates by credit score (Q2 2026); Consumer Financial Protection Bureau, auto loans.