How to use Car Loan Calculator
- Enter the car price and your down payment, as a percentage or an amount.
- Enter the yearly rate from the bank or dealer, and pick "Flat rate" if the offer says flat.
- Choose the term, from 1 to 7 years.
- Compare the monthly payment, the total interest and the total cost of the car, and download the schedule if you need it.
Why use Car Loan Calculator
Down payment built in
See the amount financed, and the total cost of the car with the down payment included.
Flat or reducing rate
Many car offers quote a flat rate; the calculator shows the real yearly rate (APR) so you can compare offers.
Islamic car finance
Switch the wording to profit for murabaha or ijara offers quoted as a profit rate.
Chart and CSV
Watch the balance fall year by year, or download the monthly schedule as a spreadsheet.
About this tool
Car finance, or an auto loan, is usually shorter than a home loan, often 1 to 7 years, and many dealers and banks quote a flat rate. A flat rate is charged on the full amount for the whole term, even though you repay part of the loan every month, so a flat 4.5% over five years costs about the same as 8.3% on a reducing balance. This car loan calculator shows both, so you can compare a flat offer with a reducing-balance one.
Your down payment lowers the amount you finance, and so the interest you pay on it. Lenders often set a minimum down payment and add insurance or takaful, registration and processing fees, which are not included here. Check the final figures with your bank or dealer before you sign.
Frequently asked questions
How is the monthly car payment calculated?
For a reducing-balance loan, EMI = P × r × (1 + r)ⁿ ÷ ((1 + r)ⁿ − 1), where P is the car price minus the down payment, r the monthly rate and n the number of months. For a flat rate, the payment is (P + P × rate × years) ÷ months.
What is the difference between a flat and a reducing rate?
A flat rate charges interest on the full amount for the whole term; a reducing rate charges it only on the balance still owed. The same number therefore costs much more as a flat rate: 4.5% flat over 5 years is about 8.3% reducing.
How much down payment should I make?
As much as you comfortably can. Every amount you pay upfront is not charged interest, and a lower balance also means a smaller monthly payment. Check your lender's minimum.
Does it work for Islamic car finance?
Yes. Choose "Profit (Islamic)" and enter the profit rate. Murabaha car finance is often quoted as a flat profit rate, so choose "Flat rate" as well if the offer says flat.
What is a good car loan term?
Shorter terms cost less interest but have higher monthly payments. Many buyers choose three to five years; compare a few terms here to see the monthly payment and the total cost side by side.
Is this a car installment calculator?
Yes. Enter the price of a new or used car, your down payment, the rate and the term, and it shows the monthly installment, the total you will pay and the full schedule.