TOOLKnow your real car payment before the dealer does
The sticker price is only part of the story. Your actual monthly payment depends on your down payment, any trade-in, the sales tax, the interest rate (APR), and how many months you finance. This calculator combines all of them so you walk in knowing the number — and can spot when a dealer's "great monthly payment" just hides a longer term.
How the payment is worked out
Two steps. First, the amount you actually finance:
Then that amount goes through the standard auto-loan formula:
where P is the amount financed, r is the monthly rate (APR ÷ 12), and n is the number of months.
Buying vs. leasing
A loan builds equity — the car is yours once it's paid off. A lease usually has a lower monthly payment but you hand the car back at the end. Compare the two with our car lease calculator, and if you lease, check your kilometre limits with the lease mileage calculator.
Estimates are for planning only and assume a fixed APR with equal monthly payments. They don't include dealer fees, registration, gap insurance, or variable-rate changes, and tax rules vary by region. Confirm exact figures with your lender.
Frequently asked questions
How is a monthly car payment calculated?
First the amount financed is worked out: vehicle price plus sales tax, minus your down payment and trade-in. That amount is then run through the standard loan formula M = P × r × (1 + r)^n ÷ ((1 + r)^n − 1), where r is the monthly rate (APR ÷ 12) and n is the number of months.
Does a trade-in reduce my car loan?
Yes. A trade-in acts like extra down payment, lowering the amount you finance. In many places it also lowers the sales tax, because tax is charged on the price after the trade-in value is deducted.
Is sales tax included in a car loan?
It usually can be. Most buyers roll the sales tax into the amount financed, so this calculator adds tax to the loan by default. Paying the tax up front instead would lower your monthly payment.