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The formula for the principal amount of your car loan is(Purchase price) 鈥?(rebates) 鈥?(cash down payment) 鈥?(trade in value). A car purchase will also include fees and sales tax. Those two amounts are typically included in the principal amount.
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How do I calculate my monthly car loan payment?
To calculate your monthly car loan payment by hand, divide the total loan and interest amount by the loan term (the number of months you have to repay the loan). For example, the total interest on a $30,000, 60-month loan at 4% would be $3,150.
How is simple interest calculated on a car loan?
The vast majority of car loans use simple interest. In order to calculate the amount of simple interest you will pay, you鈥檒l first have to calculate your monthly payment using this formula: M represents your monthly payment. This is what the formula will be calculating. P represents your principal.
How do you calculate amortization on a car loan?
Most car loans use an amortization schedule to calculate interest. The formula to compute amortization is complicated, even with a calculator. Car buyers can find amortization calculators on the web. If your car loan uses simple interest, you can use the calculator to determine your monthly payment amount.
How do I find the lowest auto loan rates?
Use our auto loan calculator to estimate monthly car payments and find the lowest rates available. Then you can shop for the vehicle that fits your budget and negotiate the best deal. Already have an auto loan? Refinancing your auto loan could save you money.