How to Use This Auto Loan Calculator
Start by selecting whether you're buying a new car, used car, or refinancing. Then enter the vehicle price, down payment, trade-in value, sales tax, and any dealer fees. The calculator automatically computes the amount you're financing as you type.
Enter the loan APR (not the "money factor" used in leases) and your term in months. Standard auto loan terms are 36, 48, 60, 72, or 84 months. The Extra Monthly Payment field shows you how much interest you'd save by paying more than the minimum each month.
Optionally, enter your monthly gross income to see your payment-to-income ratio -- a quick affordability check lenders use.
How Your Financed Amount is Calculated
Note: tax rules vary by state. Some states tax the full vehicle price; others only tax the price after the trade-in deduction (saving you money). Florida, for example, allows a trade-in deduction before tax.
True Cost of the Vehicle
Your monthly payment is just part of the picture. The true vehicle cost = vehicle price + sales tax + fees + total interest paid over the life of the loan. On a $32,000 car with a 60-month loan at 7%, you'll pay roughly $5,600 in interest alone -- meaning the car actually costs you about $37,600 before insurance, gas, and maintenance.
The 20/4/10 Rule: Put at least 20% down, finance for no more than 4 years, and keep total vehicle costs (payment + insurance) under 10% of your gross monthly income. This keeps you from being "underwater" on the loan and controls long-term costs.
Current Auto Loan Rates by Credit Score (2026)
Auto loan rates vary significantly based on your credit score, whether the car is new or used, and your lender. Credit unions typically offer 1%–2% lower rates than banks or dealership financing.
New Car Loan Rates
| Credit Score | Credit Tier | Avg APR (New) | Monthly Payment* |
|---|
| 781–850 | Super Prime | 5.1%–6.2% | $565–$581 |
| 661–780 | Prime | 6.5%–7.8% | $588–$606 |
| 601–660 | Near Prime | 9.0%–11.5% | $636–$669 |
| 501–600 | Subprime | 13.5%–17.0% | $728–$782 |
| 300–500 | Deep Subprime | 18.0%–24.0%+ | $803–$909 |
*Monthly payments based on $30,000 loan, 60-month term. Rates are averages as of early 2026 and vary by lender.
Used Car Loan Rates
| Credit Score | Credit Tier | Avg APR (Used) | Monthly Payment* |
|---|
| 781–850 | Super Prime | 6.5%–7.5% | $388–$396 |
| 661–780 | Prime | 8.5%–10.5% | $412–$431 |
| 601–660 | Near Prime | 13.0%–16.0% | $476–$510 |
| 501–600 | Subprime | 18.0%–21.5% | $558–$600 |
| 300–500 | Deep Subprime | 22.0%–27.0%+ | $614–$685 |
*Monthly payments based on $20,000 loan, 48-month term. Used car rates are always higher due to increased lender risk.
Pro tip: Get pre-approved by your bank or credit union before visiting the dealer. This gives you a rate to beat, prevents the dealer from inflating your APR, and keeps the focus on the vehicle price rather than the monthly payment.
Frequently Asked Questions
What is a good APR for an auto loan?
For a new car, a good APR is under 7% with good credit (661+), and under 6% with excellent credit (781+). For a used car, under 9% is competitive. If you're seeing rates above 15%, consider waiting to improve your credit score, making a larger down payment, or finding a co-signer. Even a 2% rate reduction on a $25,000 loan saves over $1,300 in interest over 60 months.
How long should my auto loan term be?
Financial experts generally recommend 48 months or less for used cars and 60 months or less for new cars. While 72- and 84-month loans lower your monthly payment, they carry two major risks: (1) you'll pay significantly more in interest, and (2) you'll likely be "underwater" (owe more than the car is worth) for years, making it hard to sell or trade in without rolling negative equity into the next loan. If you need 72+ months to afford a car, the car may be more than you can comfortably afford.
Should I finance through the dealer or my bank?
Always compare both. Dealers sometimes offer manufacturer incentives like 0% APR on new cars -- these can be genuinely excellent deals. Outside of promotional rates, credit unions and banks typically offer 1%–2% lower rates than dealer-arranged financing. Get pre-approved by your credit union or bank before going to the dealership so you have a baseline. Online lenders like LightStream, Capital One Auto, and PenFed Credit Union are also worth checking.
How much should I put down on a car?
The standard recommendation is 20% for new cars and 10% for used cars. A larger down payment reduces the amount financed, lowers your monthly payment, reduces total interest, and -- critically -- helps prevent negative equity since new cars depreciate 15%–20% in the first year. If you can't put 20% down, strongly consider a less expensive vehicle. Rolling a down payment into the loan ("zero down") is fine for people with strong credit, but makes a bad situation worse for buyers who are already stretching their budget.
What is negative equity and how do I avoid it?
Negative equity (being "underwater" or "upside down") means you owe more on the loan than the car is currently worth. This happens most often with long loan terms, small down payments, and rapid depreciation on new vehicles. To avoid it: put at least 20% down, choose a term of 60 months or less, buy a vehicle with good resale value, and avoid rolling previous negative equity into a new loan. If you're already underwater, making extra principal payments each month is the fastest way to get back above water.
Is it worth refinancing my auto loan?
Auto loan refinancing makes sense when: (1) your credit score has improved since you took the original loan, (2) interest rates have dropped significantly, or (3) you financed through a high-rate dealer and didn't shop around. Refinancing is usually free or low-cost and can be done quickly online. The savings can be substantial: refinancing a $20,000 balance from 12% to 7% over 36 months saves over $1,600 in interest. Use the Refinance tab above to compare your current loan against a new rate.