How we calculate
The formulas and assumptions behind every number on this site, so you can check our work.
Monthly payment
M = P × r × (1 + r)n ÷ ((1 + r)n − 1)
P is the amount financed, r is the APR divided by 12, and n is the number of monthly payments. At 0% APR the payment is simply P ÷ n. As a check, $50,000 at 7% for 120 months gives $580.54.
Amortization and extra payments
Each month, interest is the remaining balance × r. The rest of the payment reduces the balance. Extra payments go entirely to principal, and the final payment is reduced so the balance ends at exactly zero. Totals are summed from the month-by-month schedule, not estimated.
Sales tax
Sales tax is calculated on the full purchase price. The calculator prefills each state's statewide base rate (reviewed October 21, 2026). Local taxes are not included, and some states tax vehicles under a separate title or excise tax, so you can type in your actual rate. You choose whether the tax is financed or paid at signing. Trade-in credits and dealer fees are not modeled.
Refinancing
We amortize the remaining balance at your current rate and remaining term, then at the new rate and term. Net savings = interest left on the current loan − (interest on the new loan + fees). Break-even = fees ÷ monthly payment savings, rounded up to whole months.
Ownership costs
- Fuel = miles per year ÷ miles per gallon × fuel price ÷ 12.
- Maintenance defaults to 2% of the purchase price per year. This is an assumption; change it.
- Depreciation assumes a 20% drop in the first year and 6% a year after that. Real resale values vary a lot by brand, type and condition.
Rates and tax information
Rate tables show each lender's published rates with a link and the date checked. Tax pages summarize IRS publications and link to them. Neither is a quote or advice for your situation.