Car Loan Repayment Schedule Calculator and Formula

A car loan repayment schedule calculator estimates your fixed monthly payment, total interest, and total of payments from the loan amount, annual percentage rate (APR), and term. Enter those three figures to see an estimate based on equal monthly payments; the figures do not include items such as taxes, insurance, or fees unless they are part of the amount borrowed.

Formula

The calculator uses the standard amortizing-loan payment formula. It assumes the balance is repaid through equal payments at regular monthly intervals, with interest accruing at a constant rate.

• Monthly payment: M = round[P × r / (1 − (1 + r)⁻ⁿ), 2]
• Total interest: I = M × n − P

Here, P is the amount financed in dollars; APR is the annual percentage rate entered as a percentage; r is the monthly rate, calculated as APR ÷ 1,200; n is the number of monthly payments, calculated as loan term in years × 12; M is the monthly payment in dollars, rounded to cents; and I is estimated total interest in dollars. Rounding the payment before calculating total interest reflects the cents paid each month.

Worked Example

Using the calculator’s defaults—$20,000 borrowed, 8% APR, and a five-year term:

1. Convert the APR to a monthly rate: 8 ÷ 1,200 = 0.0066667, or about 0.66667% per month.
2. Convert the term to payments: 5 × 12 = 60 months.
3. Apply the payment formula: $20,000 × 0.0066667 ÷ [1 − (1.0066667)⁻⁶⁰] = $405.53 per month, rounded to the nearest cent.
4. Calculate total paid using that rounded payment: $405.53 × 60 = $24,331.80.
5. Subtract the principal: $24,331.80 − $20,000 = $4,331.80 in estimated total interest.

Assumptions

• The interest rate stays fixed for the full loan term.
• Payments are equal, monthly, and made at the end of each payment period.
• Interest compounds monthly using APR divided by 12.
• The estimate excludes fees, taxes, insurance, and other charges unless they are included in the loan amount.

How to Read a Repayment Schedule

A repayment schedule, often called an amortization schedule, divides each payment between interest and principal. Early in a typical fixed-payment loan, the balance is relatively high, so more of each payment goes toward interest. As principal is paid down, the interest portion generally falls and the principal portion rises. The payment itself stays level under the calculator’s assumptions.

The calculator gives the monthly payment and total interest, but not a line-by-line schedule. To construct one, start with the original balance. For each month, calculate interest as the balance multiplied by the monthly rate. Subtract that interest from the payment to find the principal repaid, then subtract the principal from the balance. Repeat for each payment. Small differences can arise if a lender calculates interest using exact calendar days or applies rounding differently.

The displayed total interest is the difference between the sum of rounded monthly payments and the amount borrowed. It is not necessarily the same as multiplying an unrounded payment by the number of months. Payment rounding is important: here, $405.53 is used for all 60 payments, producing $24,331.80 total paid.

What to Enter and What Can Change the Estimate

• Loan amount: Enter the principal actually financed, not necessarily the vehicle’s advertised price. A down payment, trade-in credit, or amount rolled into the contract can affect the financed balance.
• APR: Use the APR shown in the lender’s figures, not a rate guessed from an advertisement. The actual rate and any financed charges should be confirmed with the lender.
• Term: Enter the duration in years. The calculator converts it to months; a 5-year term means 60 scheduled monthly payments.
• Extra payments: The calculation assumes no extra principal payments. Extra payments can change the payoff timing and total interest, depending on how the lender applies them.

For example, if taxes or a service contract are financed, the amount borrowed may be larger than the vehicle price. Entering only the vehicle price would then understate the payment. Conversely, a down payment that reduces principal should not be counted as money borrowed.

Common Limitations and Mistakes

This is a fixed-rate estimate, not a complete contract quotation. It does not determine lender-specific payment dates, per-day interest, fees, optional products, or any final payment adjustment. A contract may also use different rounding or payment-processing conventions. The lender’s written schedule is the reference for the actual account.

• Do not enter 8 for an 8% APR as a decimal such as 0.08; the calculator expects 8.
• Check that the term is in years, not months. Entering 60 as years would describe a much longer term than 60 months.
• Use the financed principal, rather than the down payment or the full vehicle price when those differ.
• Remember that the payment is rounded to cents. Recomputing totals with more decimal places can produce a small discrepancy.
• Do not treat estimated total interest as the full cost of owning a vehicle; expenses outside the loan are not included.

Frequently Asked Questions

How do I calculate a car loan payment?
Convert APR to a monthly rate by dividing by 1,200, convert the term to months, then use the amortizing-payment formula shown above. The calculator performs those steps and rounds the monthly result to cents.

Does the calculator include taxes and fees?
No. It models the principal, APR, and term only. If an expense is financed, include it in the loan amount; otherwise, it is outside this estimate.

Why is the first payment mostly interest?
Interest for a period is calculated on the outstanding balance. Since the balance is largest at the beginning, the interest share is generally larger then; later payments reduce the balance and the interest due.

Does a longer car loan term reduce total interest?
A longer term generally spreads repayment across more monthly payments, which can lower the payment amount for the same principal and rate, while allowing interest to accrue for more periods. The exact figures depend on the inputs.

Can I use this for a variable-rate loan?
The formula assumes a fixed APR. If the rate changes, the payment and interest path may change too, so this result will not represent the full schedule.

Is the result my exact lender payment?
No. It is a mathematical estimate based on the stated assumptions. The lender’s disclosure gives the exact figures.

This result is an estimate, and the lender’s disclosure gives the exact figures.

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in p | Loan amount | $ | 20000 | 1 | 100000000
in apr | Interest rate (APR) | % | 8 | 0.01 | 100
in yrs | Loan term | years | 5 | 0.0833 | 50
out pmt | Monthly payment | $ | round(p * (apr / 1200) / (1 - (1 + apr / 1200) ^ -(yrs * 12)), 2) | 2
out int | Total interest | $ | pmt * yrs * 12 - p | 2