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Car Loan Calculator: See the True Cost of Borrowing

The average new car loan is $40,000 at 6.8% for 68 months. That's $8,200+ in interest you'll never get back. Enter your numbers to see the real cost.

Updated Mar 2026Auto$2K–$15K+ in interest
Car Loan Cost Calculator
Enter your loan details to see monthly payment and total interest paid

Average Car Loan Rates by Credit Score (2026)

Credit ScoreNew Car RateUsed Car RateMonthly on $35KTotal Interest (60 mo)
750+ (Excellent)4.5–5.5%5.5–7.0%$652$4,100
700-749 (Good)5.5–7.5%7.0–9.5%$685$6,100
650-699 (Fair)7.5–10%9.5–13%$723$8,400
Below 650 (Poor)10–18%13–22%$800+$13,000+

The difference between excellent and poor credit on a $35,000 loan is $9,000+ in total interest. Before car shopping, check your credit score for free (Credit Karma, your bank's app) and spend 2–3 months improving it if below 700. Paying down credit card balances to under 30% utilization can boost your score 30–50 points quickly.

Car Loan Cost by Term Length

Loan TermMonthly PaymentTotal InterestTotal PaidVerdict
36 months$1,037$2,328$37,328Best value
48 months$798$3,293$38,293Great
60 months$657$4,389$39,389OK
72 months$564$5,614$40,614Caution
84 months$498$6,969$41,969Avoid

Based on $35,000 loan at 6% APR. Going from a 48-month to 84-month loan saves $300/month but costs $3,676 more in interest. Worse, with a 7-year loan you'll be underwater for years — owing more than the car is worth. The sweet spot: 48–60 months maximum.

5 Ways to Save Thousands on Your Car Loan

🏦 Get pre-approved at a credit union first — Credit union rates are typically 1–2% lower than banks and 3–5% lower than dealer financing. Walk in with your pre-approval as leverage.
📉 Keep the term to 60 months max — Every 12 months you add costs $1,000–$2,000 more in interest and puts you at risk of being underwater on the loan.
💰 Put 20% down — This avoids being upside-down on the loan, gets you better rates, and reduces total interest by thousands.
🚫 Skip dealer add-ons — Extended warranties, paint protection, fabric coating, and GAP insurance from the dealer are massively marked up. Buy GAP from your insurer for 1/3 the price.
🔄 Refinance after 6–12 months — If your credit has improved or rates have dropped, refinancing can save $1,000–$3,000 over the remaining loan.

Frequently Asked Questions

What is the average car payment in 2026?▼
The average new car payment is approximately $725/month and the average used car payment is around $530/month, according to Experian data. However, these averages reflect longer loan terms (68+ months). A financially healthy car payment should be under 10–15% of your gross monthly income, with a loan term of 60 months or less.
Should I finance through the dealer or my bank?▼
Almost always get pre-approved at a credit union or bank first. Dealer financing is convenient but typically 1–3% higher in rate. The exception: manufacturer 0% or low-rate promotional financing (like 1.9% for 36 months) can beat even the best credit union rates — just make sure there isn't a rebate you're giving up to get the low rate.
How much should I put down on a car?▼
Aim for 20% down on a new car and 10% on used. This keeps you from going underwater, gets you better interest rates, and significantly reduces total interest paid. At minimum, put enough down to cover tax, title, and fees so you're not financing those too.
Is a 72 or 84 month car loan a bad idea?▼
Generally yes. While monthly payments are lower, you pay thousands more in interest and will be underwater (owing more than the car is worth) for most of the loan. If you need a 72–84 month term to afford the payment, you're buying too much car. Consider a less expensive vehicle with a 48–60 month loan instead.
Can I pay off my car loan early?▼
Most auto loans have no prepayment penalty, so yes. Even paying an extra $50–$100/month can shave months off the loan and save hundreds in interest. Check your loan agreement to confirm there are no early payoff fees before making extra payments.
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Reviewed by Connor Price · Cost Research
📊 Data Sources & Methodology
Average rates from Edmunds, Experian State of Auto Finance, and Federal Reserve data. Payment calculations use standard amortization formulas. Updated March 2026. Learn more about our methodology.