Auto Loan Calculator
Calculate monthly car loan payments for new and used vehicles. Compare financing options and understand the true cost of your car loan.
How Auto Loan Financing Works in 2026
When you finance a car, you borrow money from a lender to pay for the vehicle. You repay the loan with interest over a set period. In 2026, average auto loan rates are 6.5-7.5% for new cars and 7-10% for used cars, depending on your credit score. The average new car price is $48,000.
2026 Auto Loan Rates by Credit Score
- Super Prime (781-850): 5.0-5.5% new / 5.5-6.5% used
- Prime (661-780): 6.0-7.0% new / 7.0-8.5% used
- Non-prime (601-660): 8.0-10.0% new / 10-13% used
- Subprime (501-600): 11-15% new / 15-20% used
New vs Used Car: Total Cost Comparison
- New $35K car at 6.5%, 60 months: $685/month, $41,100 total ($6,100 interest)
- 3-year-old used $22K at 7.5%, 60 months: $441/month, $26,460 total ($4,460 interest)
- Savings buying used: $14,640 + lower insurance + lower depreciation
5 Tips to Get the Best Auto Loan Rate
- 1. Get pre-approved — Shop credit unions and online lenders before visiting the dealer
- 2. Put 20% down on new, 10% on used — Avoid being upside-down on the loan
- 3. Choose the shortest term you can afford — 36-48 months saves thousands in interest
- 4. Don't finance add-ons at the dealer — Extended warranties and gap insurance are cheaper bought separately
- 5. Refinance if your score improves — Even 1% less on a $30K loan saves $800+
Avoid the 84-Month Loan Trap
Longer loans mean lower monthly payments, but you'll pay much more in interest and likely be upside-down (owing more than the car is worth) for years. A 72-84 month loan on a depreciating asset is a recipe for negative equity.
How to Use This Auto Loan Calculator
- Enter vehicle price — The total cost of the car you're buying
- Add down payment — Cash you'll pay upfront (recommended: at least 20% to avoid being underwater)
- Enter trade-in value — What your current car is worth (set to 0 if no trade-in)
- Set interest rate — Check your pre-approved rate from a bank or credit union (typically 5-8% in 2026)
- Choose loan term — 36, 48, 60, or 72 months. Shorter = less interest but higher payments
- Click Calculate — See monthly payment, total interest, and full amortization
Tip: Get pre-approved by a credit union before visiting the dealer. Their rates are often 1-2% lower than dealership financing.
Frequently Asked Questions
How is my auto loan monthly payment calculated?
Your monthly payment is based on the loan amount (vehicle price minus down payment), annual interest rate, and loan term (typically 36-84 months). Longer terms lower payments but increase total interest paid.
What credit score do I need for the best auto loan rates?
A credit score of 720+ typically qualifies for the best rates (as low as 5-7% APR for new cars). Scores of 660-719 may get 8-12%, while scores below 660 often see rates above 12% or may require a co-signer.
How much should I put down on a car?
A down payment of 10-20% of the vehicle's value is recommended. A larger down payment reduces the loan amount, lowers your monthly payment, and can help you qualify for better rates.
New car vs used car: which is better for financing?
New cars offer lower rates (often 0-5% promotional financing from dealers) but depreciate faster. Used cars (2-3 years old) offer better value, lower insurance costs, and similar reliability at a lower price point.
Should I get pre-approved before visiting a dealership?
Yes! Getting pre-approved by a bank or credit union before visiting dealerships gives you negotiating power, reveals your true budget, and often results in better rates than dealer financing.