How to use this car loan calculator
- Select a currency symbol for display (no exchange-rate conversion).
- Enter the car value, interest rate, and loan term in years and months.
- Optional: subtract an initial deposit or add a balloon payment due at the end of the term.
- Set the car loan start date to estimate your payoff month.
- Click Calculate — monthly payment, total interest, repayment split, charts, and amortization table update together.
Financing a boat instead? Switch to the Boat Loan Calculator using the tabs above the form.
How much interest will I pay on my car loan?
Our car finance calculator compounds your interest rate monthly over the loan period. That compounding produces the effective annual rate shown in results — slightly higher than the quoted APR when interest accrues each month on a declining balance.
The Split of Total Repayment chart shows what share of everything you pay goes to principal versus interest. Early in the schedule, interest makes up a larger slice of each payment even though the payment amount stays fixed.
Car loan payment formula
Fixed-rate auto loans use standard amortization. When a balloon is included, the monthly payment is calculated on the amount that must be repaid before the balloon — the present value of the balloon is subtracted from the loan amount first:
P = loan amount (car value − deposit), B = balloon at end, r = monthly rate, n = months
Worked example
A $15,000 car loan at 5.4% for 5 years (60 months) with no deposit or balloon:
- Monthly payment ≈ $285.83
- Total interest ≈ $2,149.54
- Total payments ≈ $17,149.54
- Effective annual rate ≈ 5.54%
What is a balloon payment?
A balloon payment is a large lump sum due at the end of the loan. Dealers sometimes use balloons to lower monthly payments during the term. When the loan ends, you must pay the balloon in full or refinance it — plan for that date before you sign.
How to calculate interest on a car loan manually
- Calculate the monthly payment using the formula above (rate as a decimal, e.g. 6% → 0.06).
- Multiply the monthly payment by the number of months to get total repayment.
- Subtract the loan amount (car value minus deposit) to get total interest.
Examples and use cases
Real-world use cases
- Dealer negotiation: A buyer runs the payment on a $28,000 SUV with $3,000 down to see whether a 72-month term fits their monthly budget.
- Balloon financing: A shopper models a low monthly payment with a $5,000 balloon due in year 5 to plan refinance or payoff options.
- Trade-in equity: Someone applies $4,000 trade-in value as a deposit to compare interest saved vs financing the full sticker price.
Related tools
Already have a loan balance and want to know how long until it is paid off? Use the Loan Payoff Calculator. For general-purpose loans with extra payment options, try the Loan Calculator. For savings growth with compounding, see the Compound Interest Calculator.