Calculate your monthly car payment, total interest cost, and compare loan terms side-by-side. See the true cost of 48, 60, and 72-month auto loans before you sign.
Based on average new vehicle price of $48,000 at 7.1% APR
Enter your vehicle price, down payment, interest rate, and term to see your exact monthly payment and total interest cost.
Open Loan Calculator →An auto loan is a secured installment loan where the vehicle itself serves as collateral. You borrow a specific amount (the purchase price minus your down payment), agree to an interest rate (APR), and repay the principal plus interest in equal monthly payments over a set term — typically 36, 48, 60, 72, or occasionally 84 months.
The monthly payment formula is the same as any amortizing loan: M = P × [r(1+r)^n] / [(1+r)^n - 1], where P is the loan amount, r is the monthly interest rate (APR ÷ 12), and n is the number of months. Our loan calculator handles this instantly for any inputs you provide.
The choice between a 60-month and 72-month loan is one of the most consequential decisions in car financing. Here's a concrete comparison for a $40,000 vehicle with 10% down ($36,000 financed) at 7.1% APR:
48-month loan: $862/month | Total interest: $5,376 | Total paid: $41,376
60-month loan: $713/month | Total interest: $6,780 | Total paid: $42,780
72-month loan: $613/month | Total interest: $8,136 | Total paid: $44,136
The 72-month loan saves $100/month vs. the 60-month, but costs $1,356 more in total interest. More importantly, the 72-month loan keeps you in negative equity (underwater) for longer. A new vehicle loses approximately 20% of its value in the first year and 15–25% in years 2–5. With a 72-month loan, you may owe more than the car is worth for the first 3–4 years, creating financial risk if the car is totaled or you need to sell.
Your down payment directly reduces the loan principal, which reduces both your monthly payment and your total interest paid. Financial experts commonly recommend putting at least 20% down on a new car and 10–15% on a used car to avoid being immediately underwater after purchase (since new cars depreciate significantly the moment they leave the dealership).
On a $48,000 new car: a 20% down payment ($9,600) on a 60-month loan at 7.1% results in a payment of approximately $759/month on $38,400 financed. No down payment on the full $48,000 gives a payment of $951/month — $192/month more for the 0% down scenario, or $11,520 more over 5 years.
Lenders charge significantly higher interest rates on used vehicles because used cars have more uncertainty around condition, value, and remaining life. In 2025, average new car APRs are approximately 6.5–8.5% for buyers with good credit (720+), while used car APRs range from 9–14% for similar credit profiles. For borrowers with fair credit (620–680), used car rates can reach 16–20%, making the total cost of a used car sometimes comparable to a new one at lower rates.
Before assuming a used car is cheaper, calculate the total cost (purchase price + total interest) for both options. A $25,000 used car at 12% over 60 months costs $5,335 in interest (total $30,335). A $30,000 new car at 6.5% over 60 months costs $5,244 in interest (total $35,244). The new car costs more in total, but the gap narrows when rate differences are factored in — and the new car comes with a warranty.
The average new car payment is approximately $950/month for a 60-month loan on a ~$48,000 vehicle. Used car average payments are ~$530/month. Both reflect elevated rates and vehicle prices since 2021.
60-month is generally better: lower total interest and you build equity faster. 72-month saves ~$100–$150/month but costs more overall and keeps you underwater longer due to depreciation. Avoid 72-month unless necessary for cash flow.
Every $1,000 down reduces monthly payments by ~$18–$22 on a 60-month 7% loan. A $5,000 down payment saves approximately $99/month and $5,940 total. It also helps avoid being immediately underwater on a depreciating asset.
Yes, significantly. New car rates average 6.5–8.5%; used car rates average 10–13% for similar credit profiles. Calculate total cost (price + total interest) for both options before deciding — the new car sometimes wins on total cost despite higher sticker price.