How is an auto loan amortization schedule calculated?

The amount financed is the vehicle price plus sales tax, minus your down payment and trade-in value. That principal then amortizes at a fixed monthly rate: interest is charged on the remaining balance each month, and the rest of the payment reduces principal, until the balance reaches zero.

Does trade-in value reduce the sales tax I pay?

In most states, yes — sales tax applies to the price minus your trade-in credit, not the full price. A handful of states don't offer this credit, so check your state's rule before assuming the tax savings.

Should I roll sales tax into my auto loan?

Rolling tax into the loan means financing (and paying interest on) that amount over the full term, which costs more than paying it up front. It's a common trade-off for cash-flow reasons, but paying tax and fees at signing — if you can — reduces total interest.

How much interest will I pay on a $35,000 car loan?

With a $5,000 down payment, 6.5% sales tax, and a 7.1% rate over 5 years, the financed amount is about $32,275 and total interest comes to roughly $6,161. Interest scales with the rate, term length, and financed amount, so a shorter term or larger down payment reduces it directly.

We Are

Calculator

Auto Loan Amortization Calculator

Full payment schedule including sales tax, down payment, and trade-in.

Auto Loan Amortization Calculator

Full payment schedule including sales tax, down payment, and trade-in.

Input Parameters

Vehicle

Vehicle Price

Down Payment

Trade-In Value

Sales Tax (%)

State + local rate — varies widely, check your DMV

Loan Terms

Interest Rate (%)

National average for new cars is ~7.1%, used cars ~11.3% (Experian 2025)

Loan Term (Years)

Auto Loan Amortization Calculator: Full Payment Schedule

This auto loan amortization calculator builds the complete payment schedule for a vehicle loan — factoring in sales tax, down payment, and trade-in value to arrive at the actual amount financed, then breaking every monthly payment into principal and interest down to a zero balance.

Worked example (the defaults): a $35,000 vehicle with a $5,000 down payment, no trade-in, and 6.5% sales tax finances $32,275.00 — the price plus $2,275 of tax, minus the down payment. At 7.1% APR over 5 years, that comes to a monthly payment of $640.61 and $6,161.45 in total interest over the loan.

Sales tax and trade-in value are easy to overlook when comparing loan offers, but they change the actual principal you're financing — and therefore every number downstream. If you're deciding whether to pay this loan off faster, run the same balance through the Car Loan Payoff Calculator to see the effect of extra monthly payments.

How the Financed Amount and Schedule Are Calculated

The amount you actually finance isn't just the vehicle price. Most states tax the vehicle price minus any trade-in credit, and that tax is commonly rolled into the loan rather than paid up front:

Financed Amount = Price + Sales Tax − Down Payment − Trade-In

Once the financed amount is set, the loan amortizes with the standard installment formula used across auto lending, per the CFPB's auto loan guidance:

M = P × [r(1+r)^n] / [(1+r)^n − 1]

Each month, interest accrues on the remaining balance and the rest of the fixed payment reduces principal — the same declining-interest, rising-principal pattern as any amortized loan, shown here row by row for the full term.

Sales Tax Rules Vary by State

Whether trade-in value reduces your taxable amount depends entirely on your state — most states give a full trade-in tax credit, a handful give none, and a few cap it. This calculator applies tax to price minus trade-in, which matches the majority of states, but check your state DMV's rule before financing if you're trading in a vehicle, since a no-credit state changes the taxed amount and therefore the financed principal.

Some states also charge tax on the down payment portion differently, or add separate title, registration, and doc fees outside the sales tax rate — this tool models sales tax specifically, so add any flat fees to your down payment field to route them out of the financed principal if you're paying them at signing.