Car Loan Interest Calculator
In Canada, purchasing a car usually entails significant financial responsibility. Even an inexpensive car costs more than the majority of people can comfortably spend with cash because all fingers are not created equal. Check out our car loan interest calculator to get an instant result for free.
As a result, the majority of Canadians must obtain an auto loan to purchase a vehicle. However, loans require monthly (or biweekly) payments, and estimating how much you’ll have to pay after accounting for the loan length, frequency of payments, interest rate, and trade-in value can be challenging.
If you are looking forward to financing your new car, you shouldn’t pay attention to the car’s total cost. The payment is the most crucial figure for you. Because how you structure your deal will determine the price you eventually pay, as an auto loan calculator will demonstrate.

Car Loan Calculator Terms
Are you uncertain of a few terminologies used in the auto loan calculator? These are the terminologies used in the auto loan calculator.
Vehicle price
This is regarded as the price of the vehicle you are looking forward to buying. Be aware that this is not the original price of the vehicle. It is just the ultimate price after all the discounts and rebates have been deducted.
Down payment
Putting down money when you start the agreement is the greatest approach to reducing your vehicle payment. For instance, your auto loan would be for $40,000 plus whatever the interest rate is if you were purchasing a $40,000 car.
However, if you put down $4000, you’ll just need a $36,000 loan plus interest. The advantage of this, aside from the cheaper sale price, is that your monthly payments will be on the lower side. Try adjusting the down payment in the Canada car loan calculator! It’s intriguing to observe how the payments fluctuate.
Trade-in-value
Your trade-in value is regarded as the sum that the dealer will provide you in exchange for your current car. Most of the time, trading in your old automobile will help you save the most money on the new car you’re ready to purchase.
Owed on trade
This is the sum of money you still owe if you haven’t completely repaid the car loan for the vehicle you’re trading in. Your trade-in debt will be added to the cost of the car you’re purchasing, raising its price. Therefore, if you want to buy a $20,000 car but still owe $4,000 on the car you’re trading in; you’ll need to take out a $24,000 loan (plus interest) to do so.
Sales tax
This is calculated in percentage. It is calculated based on the province where you are buying your vehicle in. so therefore, sales tax varies according to province. For example, sales tax is 12% in BC; 5% in NWT, Alberta, Nunavut, and Yukon; 11% in Saskatchewan; 13% in Ontario and Manitoba; and 15% in, PEI, Quebec, Nova Scotia, Newfoundland, and New Brunswick.
Loan term
The length of your loan term will determine how long you have to pay off your new car. However, the majority of loans have periods between 36 and 72 months. The shortest loan periods are 12 months. Your payment can differ significantly depending on the loan duration you choose. Choosing a finance option for a car is arguably the most crucial choice you will have to make.
Annual Interest rate
One of the calculator’s simpler fields to fill out is this one. If you’ve identified a car you want to buy, just enter the interest rate that, given your credit history, appears reasonable. Don’t panic if you are unsure of what the interest rate will likely be.
Before meeting with the dealership, test a few figures (0%, 5%, 10%) to see how the payment amount changes to get an idea. The lowest rate you will probably receive for a used car is 4.99%.
Payment frequency
Choose from weekly, biweekly, or monthly payments depending on how often you’d like to make them. If you choose a weekly payment, you will pay less overall but four times as frequently than if you pick a monthly payment.

Why are Auto Loans Important
If you are looking forward to financing your new purchase, you don’t need to concentrate on the car’s total cost. The payment is the most important sum to you. This is because the final cost will depend on how you structure your transaction, as an auto loan calculator will show.
The factor that will affect your monthly payment the most, outside the price of the vehicle, is the length of the loan. If you plan on spreading the loan amount over a greater number of months, the monthly payment will be less.
When the loan’s payments are all made, however, you’ll have paid more for your car because of the interest you’ll be paying. Why? You will be charged interest more frequently the longer it takes you to pay off your debt.
The interest rate is the portion of your purchase that is yearly added to the price of your vehicle. Typically, it has a value between 0 and 29.99%. As a result, if you finance an automobile at 4.99%, the annual interest you pay will be almost 5% of the entire cost of the vehicle. Another factor to take into account is your car’s trade-in value.
The value of your car as a trade-in is something else to think about. If you trade in a car worth $6,000 and purchase a car worth $25,000, you will only need to obtain an auto loan for the difference of $19,000. This is the value of your new car minus the cash you receive for trading in your old car.
But if you are a Canadian and you are still owing money for the car you are trading in now, it’s a good idea to use an auto loan calculator.
This is due to the possibility that your total payment would be higher than what you had planned. Consider that even though the value of your trade-in automobile is $5000, you still owe $8000 on it.
You will therefore still owe $3000 after trading in your car. Simply add the final $3,000 to the price of the new car you want to purchase, according to the dealership. So an automobile that was previously $21,000 now costs $24,000. Your payments will consequently be a little bit higher than usual.
How to Calculate Interest on an Auto Loan
As it was being mentioned before, an auto loan calculator displays the total interest you’ll pay throughout the loan. So as a Canadian who is willing to take a car loan, you will also see your monthly interest payment if the calculator provides an amortization schedule.
For the majority of auto loans, the principal which is the original amount you borrowed, and interest are split equally between each payment.
Considering how the loan’s then-current balance is used to determine the monthly interest payment. Therefore, you pay more interest at the beginning of the loan when the balance is bigger. The amount of the monthly payments that go toward interest decreases over time as the balance is paid down.
If you’re up for a little math, you can figure out how much interest you owe using the car loan calculator or by hand. Here is the calculation you can use to manually determine your monthly car loan interest:
Monthly interest = (Interest rate divided by 12) multiplied by the loan balance
So therefore with the above formulae, you can calculate your monthly interest payment on your car loan. Thanks for checking out our car loan interest calculator.
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Interest Rate
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Result
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Car Loan Interest Calculator
Year | Principal | Interest | Payment | Balance |
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In Canada, purchasing a car usually entails significant financial responsibility. Even an inexpensive car costs more than the majority of people can comfortably spend with cash because all fingers are not created equal. Check out our car loan interest calculator to get an instant result for free.
As a result, the majority of Canadians must obtain an auto loan to purchase a vehicle. However, loans require monthly (or biweekly) payments, and estimating how much you’ll have to pay after accounting for the loan length, frequency of payments, interest rate, and trade-in value can be challenging.
If you are looking forward to financing your new car, you shouldn’t pay attention to the car’s total cost. The payment is the most crucial figure for you. Because how you structure your deal will determine the price you eventually pay, as an auto loan calculator will demonstrate.

Car Loan Calculator Terms
Are you uncertain of a few terminologies used in the auto loan calculator? These are the terminologies used in the auto loan calculator.
Vehicle price
This is regarded as the price of the vehicle you are looking forward to buying. Be aware that this is not the original price of the vehicle. It is just the ultimate price after all the discounts and rebates have been deducted.
Down payment
Putting down money when you start the agreement is the greatest approach to reducing your vehicle payment. For instance, your auto loan would be for $40,000 plus whatever the interest rate is if you were purchasing a $40,000 car.
However, if you put down $4000, you’ll just need a $36,000 loan plus interest. The advantage of this, aside from the cheaper sale price, is that your monthly payments will be on the lower side. Try adjusting the down payment in the Canada car loan calculator! It’s intriguing to observe how the payments fluctuate.
Trade-in-value
Your trade-in value is regarded as the sum that the dealer will provide you in exchange for your current car. Most of the time, trading in your old automobile will help you save the most money on the new car you’re ready to purchase.
Owed on trade
This is the sum of money you still owe if you haven’t completely repaid the car loan for the vehicle you’re trading in. Your trade-in debt will be added to the cost of the car you’re purchasing, raising its price. Therefore, if you want to buy a $20,000 car but still owe $4,000 on the car you’re trading in; you’ll need to take out a $24,000 loan (plus interest) to do so.
Sales tax
This is calculated in percentage. It is calculated based on the province where you are buying your vehicle in. so therefore, sales tax varies according to province. For example, sales tax is 12% in BC; 5% in NWT, Alberta, Nunavut, and Yukon; 11% in Saskatchewan; 13% in Ontario and Manitoba; and 15% in, PEI, Quebec, Nova Scotia, Newfoundland, and New Brunswick.
Loan term
The length of your loan term will determine how long you have to pay off your new car. However, the majority of loans have periods between 36 and 72 months. The shortest loan periods are 12 months. Your payment can differ significantly depending on the loan duration you choose. Choosing a finance option for a car is arguably the most crucial choice you will have to make.
Annual Interest rate
One of the calculator’s simpler fields to fill out is this one. If you’ve identified a car you want to buy, just enter the interest rate that, given your credit history, appears reasonable. Don’t panic if you are unsure of what the interest rate will likely be.
Before meeting with the dealership, test a few figures (0%, 5%, 10%) to see how the payment amount changes to get an idea. The lowest rate you will probably receive for a used car is 4.99%.
Payment frequency
Choose from weekly, biweekly, or monthly payments depending on how often you’d like to make them. If you choose a weekly payment, you will pay less overall but four times as frequently than if you pick a monthly payment.

Why are Auto Loans Important
If you are looking forward to financing your new purchase, you don’t need to concentrate on the car’s total cost. The payment is the most important sum to you. This is because the final cost will depend on how you structure your transaction, as an auto loan calculator will show.
The factor that will affect your monthly payment the most, outside the price of the vehicle, is the length of the loan. If you plan on spreading the loan amount over a greater number of months, the monthly payment will be less.
When the loan’s payments are all made, however, you’ll have paid more for your car because of the interest you’ll be paying. Why? You will be charged interest more frequently the longer it takes you to pay off your debt.
The interest rate is the portion of your purchase that is yearly added to the price of your vehicle. Typically, it has a value between 0 and 29.99%. As a result, if you finance an automobile at 4.99%, the annual interest you pay will be almost 5% of the entire cost of the vehicle. Another factor to take into account is your car’s trade-in value.
The value of your car as a trade-in is something else to think about. If you trade in a car worth $6,000 and purchase a car worth $25,000, you will only need to obtain an auto loan for the difference of $19,000. This is the value of your new car minus the cash you receive for trading in your old car.
But if you are a Canadian and you are still owing money for the car you are trading in now, it’s a good idea to use an auto loan calculator.
This is due to the possibility that your total payment would be higher than what you had planned. Consider that even though the value of your trade-in automobile is $5000, you still owe $8000 on it.
You will therefore still owe $3000 after trading in your car. Simply add the final $3,000 to the price of the new car you want to purchase, according to the dealership. So an automobile that was previously $21,000 now costs $24,000. Your payments will consequently be a little bit higher than usual.
How to Calculate Interest on an Auto Loan
As it was being mentioned before, an auto loan calculator displays the total interest you’ll pay throughout the loan. So as a Canadian who is willing to take a car loan, you will also see your monthly interest payment if the calculator provides an amortization schedule.
For the majority of auto loans, the principal which is the original amount you borrowed, and interest are split equally between each payment.
Considering how the loan’s then-current balance is used to determine the monthly interest payment. Therefore, you pay more interest at the beginning of the loan when the balance is bigger. The amount of the monthly payments that go toward interest decreases over time as the balance is paid down.
If you’re up for a little math, you can figure out how much interest you owe using the car loan calculator or by hand. Here is the calculation you can use to manually determine your monthly car loan interest:
Monthly interest = (Interest rate divided by 12) multiplied by the loan balance
So therefore with the above formulae, you can calculate your monthly interest payment on your car loan. Thanks for checking out our car loan interest calculator.
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