Used Car Loan Calculator

Used Car Loan Definition

When shopping for a car loan, you need monthly payments that fit your budget. As you shop for cars, collect trade-in offers and financing rates, refer to this calculator often to check the affordability of the monthly payment.

How to Use the Loan Calculator

There are six fields to fill in, some of which are optional, in order to produce a monthly payment figure:

1. Car Loan Amount is the car’s total price not including sales tax.
2. Down Payment is the cash you can put toward the car, if any. If you have no down payment, leave this field blank or fill in zero.
3. Trade-In Value is an estimate of your current car’s value. If you have no car for trade-in, fill in zero or leave it blank.
4. Car Loan Period is the number of months to pay back the loan. For example, a 3-year loan term is entered as 36.
5. Interest Rate is the annual percentage rate for the loan. If the loan has a rate of 5 percent, fill in 5, not 0.05.
6. Sales Tax is the percentage of tax added to the purchase price, if any. It may be left blank if your state does not levy sales tax.

An Example

You find a used car for $10,000 and your car is worth $4,000. You can make a down payment of $500. Fill in the first three fields with 10000, 4000 and 500, respectively.

You only want to make payments for two years and have found a loan with an interest rate of 6 percent. Fill in the next two fields with 24 and 6. If your state charges sales tax of 4 percent, fill in the last field with 4.

Now, hit the Calculate button and your monthly payment will be revealed as $261.49.

You can then hit the Back button and all the fields still hold your figures. Change the loan term to 36 months, hit Calculate and your monthly payment is now $179.49.

How to Calculate Used Car Loan

Let's be honest - sometimes the best used car loan calculator is the one that is easy to use and doesn't require us to even know what the used car loan formula is in the first place! But if you want to know the exact formula for calculating used car loan then please check out the "Formula" box above.

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