Car Loan Calculator
From the car price, down payment, trade-in, rate and term, compute the loan amount, monthly payment and total interest.
Input Data
Results
Payment trend (remaining principal / cumulative interest)
Principal vs interest per year
Loan principal vs total interest
Chart notes:Under equal instalments, early payments are mostly interest with little principal repaid; as the balance falls, the interest share shrinks. Extending the term lowers the monthly payment but the cumulative-interest curve rises sharply — and because cars depreciate faster than you repay, a long term risks 'owing more than the car is worth'. So within cash-flow limits, shorten the term or raise the down payment.
At a glance:Loan amount = car price - down payment - trade-in (floor at zero). Monthly payment is the amortised instalment on that loan; total interest = total paid - principal. A larger down payment or trade-in lowers the loan and thus the monthly payment and total interest.
Formula
Loan amount = car price - down payment - trade-in (floor at zero).
Monthly payment = P x r / (1 - (1 + r)^-n), where P = loan amount, r = monthly rate (annual rate / 12), n = months (years x 12).
Total interest = monthly payment x n - P.
$$\text{Loan} = \text{CarPrice} - \text{DownPayment} - \text{TradeIn}$$$$PMT = P \times \dfrac{r}{1 - (1+r)^{-n}}, \quad r = \dfrac{\text{annualRate}}{12}, \quad n = \text{years} \times 12$$$$\text{TotalInterest} = PMT \times n - P$$How to Use
- Enter the car price, down payment and trade-in value.
- Enter the annual interest rate and the loan term.
- View the loan amount, monthly payment and total interest.
Monthly payment and total interest at different rates and terms.
| Term | 3% p.a. | 5% p.a. | 7% p.a. |
|---|---|---|---|
| 3 years | PMT HK$6,979 / Interest HK$11,262 | PMT HK$7,193 / Interest HK$18,949 | PMT HK$7,411 / Interest HK$26,778 |
| 5 years | PMT HK$4,312 / Interest HK$18,749 | PMT HK$4,529 / Interest HK$31,746 | PMT HK$4,752 / Interest HK$45,137 |
| 7 years | PMT HK$3,171 / Interest HK$26,380 | PMT HK$3,392 / Interest HK$44,940 | PMT HK$3,622 / Interest HK$64,268 |
Based on a loan of HK$240,000 (car price HK$300k, down payment HK$60k), computed by the amortisation formula; for reference only, actual terms subject to lender approval.
Case Studies
Term choice: same car, 3 vs 7 years — interest gap over HK$50k
Loan HK$240,000 at 5% p.a.: 3-year term gives PMT about HK$7,193 and total interest about HK$18,949; a 7-year term drops the PMT to about HK$3,392 but total interest rises to about HK$44,940.
Stretching from 3 to 7 years cuts the monthly payment by about HK$3,801, easing short-term cash flow, but costs about HK$25,991 more interest over the loan. The longer the term, the lower the monthly payment but the higher the total interest — and the higher the risk of 'still paying while the car has heavily depreciated'.
The power of the down payment: pay more upfront, save interest directly
Car HK$300k, 5% p.a., 5-year term. Down payment HK$60k (loan HK$240k): PMT about HK$4,529, total interest about HK$31,746.
Raise the down payment to HK$100k (loan HK$200k): PMT drops to about HK$3,774 and total interest to about HK$26,455 — just HK$40k more down payment saves about HK$5,291 in interest. More down payment means a lower loan, cutting both interest and monthly burden, but keep enough emergency cash.
FAQ
How does the down payment affect the loan?
The down payment directly reduces the loan amount, so a larger down payment lowers both the monthly payment and the total interest. It is the most direct lever to cut financing cost and the lender's risk.
What does trade-in mean?
It is the value of your old car offset against the new car price, reducing the amount you need to borrow. It works like an extra down payment — the more trade-in value, the smaller the loan and the less interest.
Is the monthly payment the full cost of the car?
No. This is principal + interest only. The real cost also includes first registration tax, insurance, vehicle licence, maintenance and possible dealer/mortgage fees. Add these to compare with renting or buying with cash.
Car loan vs personal loan vs hire purchase?
A car loan is secured on the vehicle (usually lower rate). A personal loan is unsecured (often higher rate, more flexible). Hire purchase means you do not own the car until the final payment. Compare the APR, term, fees and ownership terms; the cheapest nominal rate is not always the cheapest overall.
Any Hong Kong notes on car finance?
Hong Kong car loans are commonly offered by banks and finance companies; watch the APR, handling fees and early-repayment terms. The car itself carries first registration tax, annual licence and insurance as separate costs. For a like-for-like comparison, use the effective annual rate and total cost of credit, and never borrow beyond your debt-servicing capacity (see the debt-to-income ratio).
Related Tools
References
Content review: Calculatorism Finance Team. Results are for reference only; please refer to the relevant authorities for the official figures.