A car's monthly payment is the number dealers like to talk about, and it is the least useful one for comparing deals. The cost that matters is the total across the whole time you own it: the purchase price, the interest, fuel, insurance, maintenance and the value you lose to depreciation.
Use the payment and loan calculators to see how term length changes total interest, the Car Depreciation Calculator to estimate what the car will be worth when you sell, and the fuel and mileage tools to turn miles per gallon into a cost per mile you can compare between vehicles.
Buying & Financing
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Car Loan CalculatorAuto loan with down payment
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Value after any number of years
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Debt-to-Income Ratio CalculatorDTI for mortgage qualification
What term length does to a $28,000 loan
At 6% APR, stretching the same loan over more months lowers the payment and raises the total interest paid.
| Term | Monthly payment | Total interest |
|---|---|---|
| 48 months | $657.58 | $3,564 |
| 60 months | $541.32 | $4,479 |
| 72 months | $464.04 | $5,411 |
| 84 months | $409.04 | $6,359 |
Going from 48 to 84 months cuts the payment by about $248 a month but adds almost $2,800 in interest, and keeps you in debt for three more years on a car that is losing value the whole time.
Long loan terms lower the payment and raise the interest, and they leave you owing more than the car is worth for longer. If you finance, compare offers by APR and total cost, and get a quote from a bank or credit union before visiting a dealership so you have something to compare against.