r = APR ÷ 12 and n = term in months. Sales tax is usually financed into the loan, while your down payment and trade-in reduce the amount borrowed. A shorter term means higher payments but far less total interest.
What your car really costs
Your amount financed is the vehicle price plus sales tax, minus your down payment and any trade-in. That's amortized over the term at your APR to produce the monthly payment. The donut shows how much of your total goes to the car versus interest.
Watch how a shorter term or bigger down payment cuts total interest — often by thousands over the life of the loan.
Worked example
A $32,000 car with 7% sales tax ($2,240), a $5,000 down payment and a $3,000 trade-in leaves $26,240 financed. Over 60 months at 7% APR, that's about $520/month and $4,930 of total interest. Stretch to 84 months and the payment falls to ~$396 — but total interest jumps to about $7,030, and you'll likely owe more than the car is worth for years.
The term-length trap
Longer terms (72–84 months) are how dealers make expensive cars "affordable." The payment drops, but you pay interest for longer on a depreciating asset — a recipe for being upside down (owing more than the car's value). A common guideline: 20% down on new (10% used), a term of 60 months or less, and total vehicle costs under ~15% of take-home pay.
What actually moves the payment
In order of impact: the amount financed (negotiate price, bring down payment/trade-in), the term, then the APR — which depends heavily on your credit score; getting pre-approved by a bank or credit union before the dealership gives you a benchmark to beat. Compare plain financing scenarios in the loan calculator, and don't forget running costs — estimate fuel with the fuel cost calculator.
Estimates only; not a financing offer.