Car Loan Calculator

How to Calculate Car Loan Repayments

Enter your loan amount, interest rate and loan term above and this tool instantly works out your weekly, fortnightly or monthly car loan repayment. Add a balloon payment — a lump sum left owing at the end of the term — and see exactly how much it lowers your regular repayment against how much extra interest it costs overall.

The Formula Behind the Calculation

A car loan without a balloon amortizes the same way as a home loan: each repayment covers the interest on your current balance plus a portion of principal, with the balance reaching zero at the end of the term. A balloon payment changes the target — instead of solving for the repayment that pays the loan to zero, the calculator solves for the repayment that leaves exactly the balloon amount still owing after the final payment. A larger balloon means less principal is repaid along the way, which is why it lowers the regular repayment but increases the total interest paid.

Worked Example

A $30,000 car loan at 7.5% p.a. over 5 years with a 30% balloon ($9,000 owing at the end) comes to a monthly repayment of about $477 and $7,623 in total interest. The same loan with no balloon would cost $601 a month — $124 more — but only $6,068 in total interest, about $1,555 less than the balloon option.

Frequently Asked Questions

How do I calculate car loan repayments?

Enter the loan amount, interest rate and loan term above, and your repayment is calculated instantly using the standard amortization formula: payment = P × r ÷ (1 − (1 + r)⁻ⁿ), where P is the loan amount, r is the interest rate per period, and n is the total number of payments. Add a balloon payment and the formula adjusts so the loan balance lands exactly on the balloon amount at the end of the term instead of zero.

What is a balloon payment on a car loan?

A balloon (or residual) payment is a lump sum you still owe at the end of the loan term, instead of paying the loan down to zero. It's common in car finance and novated leases because it lowers your regular repayment — the trade-off is a lump sum due at the end, usually covered by trading in, refinancing, or selling the car.

Does a balloon payment save me money overall?

No — a balloon payment lowers your regular repayment but increases the total interest you pay over the life of the loan, because you're paying down less principal along the way. The calculator above shows both numbers side by side so you can see the actual trade-off for your own loan amount and rate.

Are weekly, fortnightly or monthly car loan repayments cheaper overall?

More frequent repayments (weekly or fortnightly) reduce your balance slightly faster than monthly repayments at the same annual rate, which can shave a small amount off your total interest — the repayment-by-frequency comparison above shows the difference for your own numbers.

What's a typical car loan term and balloon percentage?

Car loans are commonly written over 3 to 7 years, and balloon payments — where offered — typically range from around 20% to 50% of the loan amount, often scaled to the loan term (a longer term usually comes with a smaller allowable balloon). Your lender sets the actual maximum balloon they'll approve.

Is this calculator accurate for my actual car loan?

It gives a close estimate using a standard fixed-rate amortization schedule with an optional balloon. Your real repayments may differ slightly due to lender fees, establishment costs, a variable rate, or a novated lease structure with its own tax treatment — confirm exact figures with your lender before signing.