Bankrate Auto Loan Calculator with Trade

This Bankrate Auto Loan Calculator with Trade helps you estimate your monthly auto loan payments when factoring in the value of your trade-in vehicle. Simply enter your loan amount, interest rate, loan term, and trade-in value to get an accurate payment estimate.

How to Use This Calculator

Using this calculator is simple:

Enter the total amount you need to finance (loan amount)
Input your interest rate (APR)
Select your loan term in years
Enter the value of your trade-in vehicle
Click "Calculate" to see your estimated monthly payment

The calculator will show you your total loan amount after trade-in, monthly payment, and total interest paid over the life of the loan.

Formula Used

The calculator uses the standard auto loan payment formula:

Monthly Payment = P × (r(1 + r)^n) / ((1 + r)^n - 1)

Where:

P = Principal loan amount (after trade-in)
r = Monthly interest rate (APR ÷ 12 ÷ 100)
n = Number of payments (loan term × 12)

The principal loan amount is calculated as:

Principal = Loan Amount - Trade-in Value

Worked Example

Let's say you want to finance a $25,000 car with a 4.5% APR over 5 years, and your trade-in is worth $5,000.

Principal = $25,000 - $5,000 = $20,000
Monthly rate = 4.5% ÷ 12 = 0.375%
Number of payments = 5 × 12 = 60
Monthly payment = $20,000 × (0.00375(1 + 0.00375)^60) / ((1 + 0.00375)^60 - 1) ≈ $350.76

Total interest paid over 5 years would be approximately $1,843.60.

Frequently Asked Questions

How does the trade-in value affect my monthly payment?

The trade-in value reduces the principal amount you need to finance, which directly lowers your monthly payment. For example, a $5,000 trade-in on a $25,000 loan reduces the principal to $20,000, which typically results in a lower monthly payment.

Is the interest rate before or after taxes?

The interest rate shown is the Annual Percentage Rate (APR), which includes all fees and is the rate you'll pay before taxes. Some states may allow you to deduct the interest from your taxes, but this calculator shows the gross amount.

Can I use this calculator for both new and used cars?

Yes, this calculator works for both new and used cars. Simply enter the purchase price of the vehicle you want to finance and the value of your trade-in vehicle.