California auto loan calculator

How California tax changes your car loan

On a $30,000 car, California’s 7.25% tax adds $2,175 to the price. If you finance it, your payment rises from $594.04 to $637.10 a month over 60 months at 7%, and you pay an extra $409 in interest on the tax. Among the 21 states in our state tables, California ranks 21 from lowest to highest base tax rate (1 is lowest).

$29,775 financed: payment by loan length

At 7% APR, financing $29,775 (the $30,000 price plus 7.25% sales tax and $600 in fees minus $3,000 down) costs $589.58 a month over 60 months and $449.38 over 84 months. The longer loan lowers the payment by $140.20 but adds $2,374 in interest. Going the other way, 36 months raises the payment to $919.37 and cuts total interest to $3,322.

How the interest rate changes a 5-year loan

On the same $29,775 over 5 years, each full percentage point of APR moves the payment by about $14.15 and total interest by about $849.

What a bigger down payment does

Putting $6,000 (20%) down on this $30,000 car lowers the loan from $32,775 to $26,775.

California sales tax on a car purchase

California’s base sales tax on vehicles is 7.25%, and many cities and counties add a district tax on top, so the real rate is often 8% to 10%. Registration, license and smog fees are separate.

This calculator uses 7.25% as the starting tax rate, and you can change it to match your county. If you roll the tax into the loan, you pay interest on it too.

Paying extra

Adding $100 a month to this loan would pay it off 10 months sooner and save $971 in interest, as long as your lender applies extra money to principal and charges no prepayment penalty. Ask before you start.

Can you afford a $30,000 car?

A common rule of thumb, the 20/4/10 guideline, suggests 20% down, a term of at most 4 years and total car costs under 10% of gross income. On payment alone, $589.58 a month points to a gross income of roughly $70,700 a year to stay at 10%, before insurance, fuel and maintenance. This loan departs from the guideline because the down payment is 10% rather than 20% and the term of 60 months is longer than 48, so the payment is lower than a stricter plan would give but the loan costs more overall.

Will you owe more than the car is worth?

New cars commonly lose around 20% of their value in the first year and roughly 15% a year after that, though this varies by model. Using that rough rule on a $30,000 car, you would likely owe more than the car is worth until about year 2. Gap insurance can cover the difference if the car is totaled while you are underwater.