The real price of a long loan
Longer car loans lower the monthly payment but raise the total cost, and they keep you owing more than the car is worth for longer because cars lose value quickly in the first few years. On $30,000 at 7.5%, a 60-month loan costs about $6,070 in interest. Stretching to 84 months drops the payment but pushes interest past $8,600. The bars show the trade-off.
Paying a little extra each month shortens the loan and reduces interest, as long as the lender applies it to principal and there is no prepayment penalty, which is uncommon on US auto loans but worth checking.
Common questions
How much is a $30,000 car loan payment?
About $601 a month at 7.5% over 60 months, or $725 over 48 months.
Is it better to pay off a car loan early?
If the rate is higher than what your savings earn and there is no penalty, paying early saves interest.
What is a good car loan term?
Many planners suggest 60 months or less, with at least 10% to 20% down.
This calculator gives estimates for planning. Real returns, rates and prices change, so treat the result as a guide rather than a promise. Read how we build and check our calculators.