Loan calculator
A $25,000 car loan at 7% for 5 years costs $4,712 in interest — you pay $29,712 for a $25,000 car. At 12% (common for lower credit scores), total interest jumps to $8,503, making your $25,000 car cost $33,503. The rate spread between "good" and "fair" credit is often 5 percentage points, costing thousands over the loan term.
Good to know
Auto loans are negotiable; rates aren't fixed. Dealers often mark up the rate they get from lenders. A bank might approve you at 6%, but the dealer shows you 8% and pockets the spread. Get pre-approved by your bank or credit union before shopping. The dealer can still beat it — and now they're competing.
Paying biweekly instead of monthly saves money. Making half payments every two weeks equals 26 half-payments per year — that's 13 full payments instead of 12. On a $25,000 loan at 7% for 5 years, this pays off the loan 3 months early and saves about $140 in interest. Small change, but free money.
Longer terms mean lower payments but higher total cost. A $25,000 loan at 7% for 3 years: $772/month, $2,784 total interest. Same loan for 6 years: $427/month, $5,732 total interest. The monthly savings of $345 costs you $2,948 extra over the life of the loan. Choose the shortest term you can afford.
Disclaimers & sources
For reference only. Not financial advice. Actual terms depend on the lender.