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Auto Loan Calculator Faqs

Are Post-it Notes Strong Enough to Tow a Car?

How can I calculate car payments with taxes and fees?

Sales taxes and other fees that typically come with car purchases can be rolled into the auto loan financing. This means that those fees will be calculated alongside the auto price, down payment, loan term, and interest rate. However, in some cases, especially for buyers with low credit scores, the fees might have to be paid upfront.

How to use the auto loan calculator?

To make use of the auto loan calculator, input the total purchase price, loan term in months, interest rate, down payment, sales tax, select your state, and registration fees in the boxes provided. If you would like to carry out a trade-in, input the value of the trade-in. Otherwise, leave it at zero. The calculator will display the monthly payments for your loan.

If you already know how much you can afford each month, and want to see the total purchase price that can allow you to borrow, click the purchase price tab and follow the same procedure as before, but this time enter your potential monthly payment in the box provided.

What is the payment on a $40,000 car loan?

Calculating the monthly payment on a $40,000 car loan is pretty straightforward. All you need to do is head over to our auto-loan calculator, input the interest rate on your loan and the length of the loan term, and your monthly payment will be displayed. For $40,000 loans, monthly payments averagely range between $900 and $1,000, depending on the interest rate and loan term.

What Car Payment Can You Afford

Many or all of the products featured here are from our partners who compensate us. This may influence which products we write about and where and how the product appears on a page. However, this does not influence our evaluations. Our opinions are our own. Here is a list ofour partnersandhere’s how we make money.

Before you hit the dealership you should take a moment to decide what monthly car payment you can afford.

To cut to the chase, its smart to spend less than 10% of your monthly take-home pay on your car payment, so you can keep your total car costs below 15% to 20% of your income.

That might leave you feeling you can afford only a beat-up Yugo. But theres an interesting caveat to this rule of thumb. Its called the balanced budget approach. Heres how it works.

About Our Car Loan Calculator

Use our auto loan calculator to estimate your monthly car payment based upon the price of the car, your down payment and trade-in allowance, taxes and fees, and the interest rate and term of your auto loan. See how changing one factor will affect your down payment.

The auto loan calculator will also show you the total interest paid if you hold your car loan for the full term. Dont overlook this number! Even though you pay the interest over many years, this is real money that gets added to the total purchase price of the car. If you want to save money, look at ways you can reduce the interest you pay: Buy a less expensive car, put more money down, and/or get a shorter loan with larger monthly payments .

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How To Calculate Monthly Car Payments

Besides a house or college tuition, buying a car is one of the most expensive purchases that a person can make. Understanding the cost to purchase and operate a vehicle monthly is essential and something that is often underestimated. Its also important not to lose sight of the total cost of buying a car when trying to lower the monthly payment with a longer length car loan.

How To Calculate Car Insurance Rates And Save Money


There are a number of factors that determine the monthly cost of car insurance. When deciding on the appropriate price, insurance companies look at the likelihood that youll make a claim and the potential loss amount.

Thats why we ask for details about your driving habits and your insurance history, the make and model of your car, as well as how old you are. Your answers will determine how much you pay.

Never lie to an insurance company for the sake of scoring a lower rate. It will backfire and may even result in you losing your insurance altogether .

Here are the most important factors that influence your premium and why we need to ask for this information.

If youre looking to insure a newer car, it might be a good idea to purchase collision and/or comprehensive insurance. Both types of coverage will help pay for repairs, or even a replacement car, since most people cannot afford to pay for a new car out-of-pocket. If our calculator detects that you are looking to insure a current model year car, it will automatically add collision and comprehensive coverage to your quote.

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How To Use Our Online Totaled Car Value Calculator To Determine The Price Of Your Totaled Vehicle

If youre looking for an ideal way to get a good estimate for your totaled car then youre better off with our online totaled car value calculator. Youll get a guaranteed quote in a minute.

This will save you the stress of having your car towed to the scrapyard where youll waste time haggling prices and end up selling for a very low price.At SellMax, youre not pressured to sell your totaled car once you get an offer from usthe ball is always in your court. Youre always welcome to use our online totaled car value calculator to know what your totaled car is worth.Youll get a fair offer from us for your car, no matter the state its in.

Dealership Financing Vs Direct Lending

Generally, there are two main financing options available when it comes to auto loans: direct lending or dealership financing. The former comes in the form of a typical loan originating from a bank, credit union, or financial institution. Once a contract has been entered with a car dealer to buy a vehicle, the loan is used from the direct lender to pay for the new car. Dealership financing is somewhat similar except that the auto loan, and thus paperwork, is initiated and completed through the dealership instead. Auto loans via dealers are usually serviced by captive lenders that are often associated with each car make. The contract is retained by the dealer but is often sold to a bank, or other financial institution called an assignee that ultimately services the loan.

Direct lending provides more leverage for buyers to walk into a car dealer with most of the financing done on their terms, as it places further stress on the car dealer to compete with a better rate. Getting pre-approved doesn’t tie car buyers down to any one dealership, and their propensity to simply walk away is much higher. With dealer financing, the potential car buyer has fewer choices when it comes to interest rate shopping, though it’s there for convenience for anyone who doesn’t want to spend time shopping or cannot get an auto loan through direct lending.

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In Fact Dont Go To A Dealership At All

For decades, car dealerships have employed seedy manipulation tactics like including hidden costs, undervaluing your trade-in, and telling outright lies just to get you in the door.

And now, with lower inventory and increasing pressure from Carmax and Carvana, theyre getting bolder and more desperate.

You can still negotiate a good deal with dealerships, but youll need to enter the lions den ready to fight. For everyone else, Carmax is a much better choice.

Read more: Ex-car salesman tells all: how to beat the auto dealerships at their own game

What Is A Totaled Car

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A car is referred to as totaled when its a total loss after an accident. This means that your car has been damaged to the extent that having it repaired wont be worth it.Lets say your car is worth $9,000 and after an accident, it would need $8,000 worth of work. Is it worth it? The clear answer is NOyour car is already a total loss. So youre probably wondering How do I sell my car thats been totaled?The only thing left that will be valuable about your car will be the parts which you can sell as scrap metal.

You can have an auto-appraiser check the amount of damage done to your car. When youve had the check done, itd be easier to determine the totaled car value.Most times, your car stands a greater chance of being totaled if its an older model. This is because older car models tend to have lower values of resale.

If the damage done to an older car is severe, its very likely to have the cost of replacing the damaged parts exceed the cars value.So, what an auto appraiser does is to estimate the repair costs and weigh it with the value of your car to know if its indeed totaled.This is why youll find a lot of people unwilling to have their totaled cars repaired and would rather have it sold, probably as a research study for an automotive class.

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Understanding Your Car Payment

Now you have an estimated auto payment youll have a better sense of what kind of new or used vehicle loan could work for you. Is your payment too high? Do you have more room for an auto payment in your budget? Adjust the terms to see how the figure changes.

While the monthly amount is important, also think carefully about the total cost of the purchase and how much you would pay in total interest charges.

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Average Car Loan Interest Rates By Credit Score

Many or all of the products featured here are from our partners who compensate us. This may influence which products we write about and where and how the product appears on a page. However, this does not influence our evaluations. Our opinions are our own. Here is a list ofour partnersandhere’s how we make money.

If youre in the market for a new or new-to-you vehicle, average car loan interest rates by credit score may give you an idea of what rate to expect from a lender.

Auto loan rates are provided as an annual percentage rate, or APR, and are based on several factors, such as your income and debt, as well as your credit score.

But your is likely the biggest factor in determining which rate youll get. The higher your credit score, the lower your car loan interest rate will probably be, because lenders perceive you as less likely to default on the loan.

How Much Does A Car Depreciate After An Accident

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The amount a car will depreciate by after an accident depends on the amount of damage done. There is a lot of difference between losing a wing mirror and being in a car totaling accident. You can expect only some depreciation for the former, while the latter will be substantial, even if fully repaired.

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What Is Depreciation The Depreciation Definition

In the simplest terms, depreciation is the decrease in value. Imagine that you bought a car for $20,000. After a few years, the vehicle is not what it used to be in the beginning. You will probably agree that selling it for $20,000 again would not be especially fair you have some sort of a gut feeling that it is worth much less now.

Economists would say that your car has depreciated over the last few years. They would also add that the basic concept of depreciation reflects the reduction in value of a vehicle over time.Moreover, they would point out that the main reasons for this reduction include car design aging, wear and tear. The more formal definition of depreciation says that it is the method of calculating the cost of an asset over its lifespan.

How Do I Calculate A Monthly Car Payment

Using the car payment calculator, fill in information like car price, interest rate and loan terms. The calculator also provides a place to add the sales tax rate for your local area. To get closer to seeing the actual payment, be sure to insert your down payment information plus your cars trade-in value, including any amount you owe. Thats how you calculate monthly car payments. Need help determining the trade-in value of your vehicle? Easy! Use our car valuation tool to get an estimate.

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How To Get The Best Deal

Got new car fever? Well, first, you need to do a little homework. With the internet, the mystery of the automobile buying process has been unveiled and you can be a well-informed buyer ready to negotiate for the best price. First of all, go to to check out vehicle reliability. You may be eying that shiny red sports car, but if its review states that this manufacturer has a history of poor performance or something like electrical issues, you may want to reconsider.

Test drive the vehicle you have in mind, but renting one from a car rental company for a couple days is the ultimate test.

How To Boost Your Credit Score

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There are many ways you can begin boosting your credit score before you consider applying for a car loan. Check out these guidelines to get you started.

Pay Your Bills On-Time

Since your plays a massive role in your final score, its essential to pay your bills on time. If you make sure you at least pay the minimum on your loans and credit cards, and dont make late payments, this should have a positive impact on your score.

Follow The 30% Rule

If you have numerous credit cards that are all maxed out, this rings alarm bells to your potential lenders. Its vital to ensure you keep outstanding balances on your credit cards below 30% of your overall limit. This will demonstrate to your banks or financial institutions that youre not low on cash and that youre responsibly for handling your finance.

Keep Credit Card Accounts Open

Its a common myth to think that if you close your credit card accounts, your credit score will increase. Thats not necessarily true. Whereas closing your credit card accounts will help you to fight the temptation of spending, it will affect your .

For example, if you have three credit cards and only one is maxed out, youve used less of your total available credit limit. But if you only have one credit card that one is maxed out, you have no available credit, therefore your credit utilization ratio is very high and your credit score will be negatively affected.

Written by Grace Gearon from | Contributing Writer for Loans Canada

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What’s The Best Option

There’s a case to be made for each of these approaches to affordability. It is essential to recognize your car-buying history, and if you do commit to a long-term loan, make sure you drive the vehicle for at least a few years after it is paid off.

In the end, the best car-buying scenario will be one that takes into account your bills and other financial responsibilities. Don’t shop for a car at the top of your budget. And if it’s a stretch for you to buy now, consider saving up a bit more and revisit shopping at a better time. The most important things are to know your budget and remember that there’s more to owning a car than just that monthly payment.

How Fast Does The Car Value Decrease

You might be surprised, but the value of your car decreases to 91% of the initial market value the minute you purchase it. Why? Well, it’s all in the perception of the next prospective buyer. At the moment you buy it, the car’s state moves from “new car” to “used car”, and even though it’s been used for just one minute, its value drops significantly.

Then, the car value continues to drop year after year. Our car depreciation calculator uses the following values :

  • After a year, your car’s value decreases to 81% of the initial value.
  • After two years, your car’s value decreases to 69% of the initial value.
  • After three years, your car’s value decreases to 58% of the initial value.
  • After four years, your car’s value decreases to 49% of the initial value.
  • After five years, your car’s value decreases to 40% of the initial value.

Our car depreciation calculator assumes that after approximately 10.5 years, your car will have zero value. Of course, you will still be able to sell it to individual buyers, but its market value will be extremely low.

In reality, each brand and model of a car loses its value at a slightly different rate formally, we say, it has its car depreciation rate. Still, you can use this calculator to show you what the value will be more or less after a specific time has elapsed.

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