Everyday money · guide
Car Loan and Personal Loan Payment Calculator: how it works in 2026, with a worked example
Turn a car's sticker price into the real payment: sales tax for your province, down payment and trade-in, the amount financed, the payment at any frequency, total interest, the date you are paid off, and whether a cash rebate beats the dealer's low rate.
How this calculator works
The payment is the level amount that repays the loan with interest over the term: P × i ÷ (1 − (1 + i)−n), where P is the amount borrowed, i is the monthly rate (APR ÷ 12) and n is the number of months. Total interest is the payment times the number of months minus the amount borrowed. The term table re-runs the same formula for common terms.
Worked example: $35,000 at 6.99%
| Term | Monthly payment | Total interest |
|---|
Assumptions
- Fixed rate for the whole term, monthly compounding, payments at the end of each month.
- No fees, insurance products or balloon payments; taxes and fees financed should be included in the amount borrowed.
Questions people ask
- What is the monthly payment on a $35,000 car loan?
- At 6.99% over 60 months it is about $693 a month and $6,570 of interest. Over 84 months the payment drops to about $528 but interest rises to about $9,340. The calculator shows every term side by side.
- Should I take a longer car loan for a lower payment?
- Only if you need to. An 84- or 96-month loan costs thousands more in interest and leaves you owing more than the car is worth for years, which is a problem if you sell or write it off. Financial regulators suggest keeping car loans to 60 months or less.
- Is 0% dealer financing really free?
- Often it replaces a cash rebate. Compare the total cost: a $35,000 car at 0% for 60 months costs $35,000; the same car with a $3,000 rebate at 6.99% costs $32,000 plus about $6,000 of interest, so the rebate plus bank financing is slightly more expensive here, but the reverse is common. Run both.
- How is a loan different from a mortgage in Canada?
- Loans compound monthly, so the monthly rate is the annual rate divided by 12. Fixed-rate mortgages compound semi-annually by law, which makes their effective monthly rate slightly lower for the same posted rate.
- Can I pay a loan off early?
- Most car and personal loans allow prepayment without penalty, and interest stops on the amount repaid. Check for administrative fees. Paying extra early in the term saves the most interest.
- What does APR include?
- The annual percentage rate must include mandatory fees and charges, not just the interest rate, so it is the right number to compare between lenders.
- Is sales tax charged on the full car price or after the trade-in?
- In most provinces the trade-in reduces the taxable price when you trade at a dealer: a $35,000 car with a $10,000 trade-in is taxed on $25,000, which in Ontario saves $1,300. Private sales are taxed differently (RST at the provincial rate in Ontario, PST in BC, none federally).
- Should I take the 0% financing or the cash rebate?
- Take whichever leaves a lower total of payments. A $2,000 rebate financed at 6.99% often beats 0% on a long term only when the financed amount is small; on $35,000 over 72 months, the 0% offer usually wins. Enter both and the calculator totals each.
- Is a bi-weekly car payment better than monthly?
- Only slightly. Unlike accelerated mortgage payments, a bi-weekly car payment is normally the monthly amount times 12 divided by 26, so you pay the same per year and save only a little interest from paying sooner. Its real benefit is matching your paycheque.
- How long a car loan is too long?
- Beyond 60 months you typically owe more than the car is worth for several years, and 84- or 96-month loans can cost thousands more in interest while trapping you if you need to sell. The term table shows the interest at each length; 48 to 60 months is a reasonable ceiling.
Sources
Every figure on this page comes from one of these primary sources. Data last verified .