Car Loan Calculator
Borrowing money for a new or used car doesn’t have to be complicated. By using our car loan calculator, you can work out your repayments and interest charges over the life of the loan.
Our car loan calculator is easy to use, simply enter the:
- Amount you wish to borrow
- The interest rate
- Loan term
- And how regularly you plan to make repayments (weekly, fortnightly or monthly)
You’ll then see how much your repayments may cost you in the long run.
Please note: our car loan calculator does not take into account all the associated loan fees and charges that you could incur. The results provided by the car loan calculator are an estimate only, and should not be relied on for the purpose of making a decision in relation to a loan. Interest rates and other costs can change over time, affecting the total cost of the loan. Consider whether you need financial advice from a qualified adviser.
What is a car loan?
A car loan is a type of personal loan taken out to buy a motor vehicle such as a car, ute, 4WD, motorbike or other road vehicle. A car loan can be a helpful form of finance if you need a car and don’t have enough savings to buy one, but you can afford to make regular loan repayments.
Your car will typically be used as security for the loan. This means that if you don’t repay the loan on time, the lender will be able to repossess your car and sell it to recover the unpaid amount. In some cases, you may be able to take out an unsecured car loan (with no security). This type of loan often comes with a higher interest rate and is more common for the purchase of used cars than for new ones.
How do you calculate a car loan payment?
Your car loan repayments will depend on factors such as:
- How much you borrow
- Loan-term length
- Interest rate (including whether it is fixed or variable)
- Fees charged on the loan.
You can use Canstar’s Car Loan Repayment Calculator (above) to help you determine how much your repayments could be and the total interest payable.
The calculator does not consider any fees that may be charged. Car loans can come with fees, such as establishment, service, late payment, additional repayment and early repayment fees. It’s important to carefully consider these fees alongside interest rates when comparing loans.
Additionally, if you take out a variable rate loan, the interest rate may change over the life of the loan. This will influence the overall cost of the loan.
It’s a good idea to read the lender’s documentation carefully before taking out a car loan, to help you determine how much you could be charged in interest and fees.
How long does it take to pay off a car loan?
The loan term is the amount of time you have to repay the loan. By taking out a loan with a longer term, you will usually be able to get lower repayments. However, it also means you’ll typically pay more in interest in the long run.
By way of example, the table below outlines the difference in interest of a hypothetical $10,000 loan at an interest rate of 9.99%, with a loan term of three, five and seven years (excluding the impact of any fees a lender may charge):
| Loan amount | Loan term | Interest rate | Monthly repayment | Total interest cost |
| $10,000 | 3 years | 13.9% | $341 | $2286 |
| $10,000 | 5 years | 13.9% | $232 | $3930 |
| $10,000 | 7 years | 13.9% | $187 | $5695 |
It’s also worth checking to see if you can make additional repayments on your loan, or pay off your loan early, and whether any fees apply. If your lender allows it, making extra repayments could help you pay off your loan quicker and save you in interest.
Explore: Can You Sell a Car With Finance Owing?
Can my credit score affect my car loan rate?
If you decide to apply for a car loan, your credit score is one factor lenders will look at in deciding whether to approve your application and what interest rate to offer you. Before you apply, it could be a good idea to check your credit score, to help ensure there are no surprises. If your score is not as high as you would like, there are steps you can take to help improve it.
Other things to consider before taking out a car loan
Here are some other factors that you might like to consider before applying for a car loan:
How much can you afford to make in car loan repayments?
It’s important to have a good idea of what size car loan you can afford. Because if you can’t make your repayments on time, you could be charged late-payment fees. Missed repayments can also affect your credit score, which could make it more difficult for you to get approved for a loan in future.
Do you have your paperwork ready to go?
Before you apply for a loan, your lender may want you to provide proof of your income (via a payslip or tax return, for example), as well as copies of current bank statements and personal identification (such as a passport or driver licence). Some lenders allow car buyers to obtain pre-approval for a loan, so they know how much they can spend on a car before they go shopping.
Have you organised car insurance?
While you are working out your budget for a car loan, it’s also important to factor in car insurance. Consider whether you need third party or comprehensive car insurance, and that what you need cover for is included in your policy. You can compare a range of comprehensive car insurance policies with Canstar.
About the author of this page
Bruce Pitchers is Canstar NZ’s Content Manager. An experienced finance reporter, he has three decades’ experience as a journalist and has worked for major media companies in Australia, the UK and NZ, including ACP, Are Media, Bauer Media Group, Fairfax, Pacific Magazines, News Corp and TVNZ. As a freelancer, he has worked for The Australian Financial Review, the NZ Financial Markets Authority and major banks and investment companies on both sides of the Tasman.
In his role at Canstar, he has been a regular commentator in the NZ media, including on the Driven, Stuff and One Roof websites, the NZ Herald, Radio NZ, and Newstalk ZB.
Away from Canstar, Bruce creates puzzles for magazines and newspapers, including Woman’s Day and New Idea. He is also the co-author of the murder-mystery puzzle book 5 Minute Murder.