Buying tool
Car loan quote comparison
Put two dealer quotes side by side — the classic matchup is a discounted price with a paid APR versus sticker price with 0% financing. Enter price, down payment, term, rate and fees to see the monthly payment, interest and final out-the-door total.
Cheaper quote saves
$1,876
Quote B costs less overall
Total cost: quote A $40,871, quote B $38,995 — a $1,876 gap.
| Quote A | Quote B | |
|---|---|---|
| Selling price | $36,000 | $38,500 |
| Amount financed | $28,000 | $30,500 |
| Monthly payment | $548 | $508 |
| Total interest | $4,871 | $0 |
| Fees | $0 | $495 |
| Cost of credit | $4,871 | $495 |
| Rough annualized cost | 3.5% | 0.3% |
| Total cost | $40,871 | $38,995 |
The down payment covers the price — nothing is financed, so the gap comes only from price and fees.
How it is calculated
Payments use the standard amortization formula: payment = principal × monthly rate ÷ (1 − (1 + monthly rate)^−months); at 0% the payment is principal ÷ months. Total cost = price + interest + fees — the down payment is identical across quotes and cancels out.
Rough annualized cost = (interest + fees) ÷ amount financed ÷ years. It exists only to compare the two quotes' financing burden — it is not a regulatory APR figure.
If a salesperson quotes a 'rate' on a flat or simple-interest basis (interest charged on the original principal for the whole term), the real APR is roughly 1.8× that number — convert before entering.
How to fill each field
- Two quotesQuote A is the discounted price with a paid APR; quote B is sticker price with 0% or subsidized financing. The field sets are independent — any two offers can be compared.
- Rate basisUse the APR on the contract, or a converted figure for flat-rate quotes. Keep finance charges out of the rate — they go in the fees field.
- Early payoffThe page assumes the loan runs to term; paying off early lowers real interest. Add any prepayment penalty to the fee field once confirmed.
FAQ
Is 0% APR financing actually a good deal?
Run the totals. 0% offers usually mean sticker price plus a finance fee, while a cash rebate plus a normal loan can cost less overall. The fee on a 0% loan works out to roughly fee ÷ amount financed ÷ years per year — if that tops the paid-APR quote's rate, the discount wins.
Where do loan fees belong in the math?
In total cost, not the rate. The 'cost of credit' row here is interest + fees, so both quotes are compared on the same basis.
Is a 'rate' the same thing as APR?
Not always. A flat rate charges interest on the original principal for the whole term, while amortized APR charges on the remaining balance. A 3% flat rate over 36 months works out to roughly a 5.4–5.7% real APR — about 1.8×.
Does a lower monthly payment mean a cheaper loan?
Not necessarily. Stretching the term drops the payment but raises total interest — always check the total-cost row, not just the monthly figure.