Axis Logo

How to Understand Car Loans

Use our car loan infographic to learn how car loans are
calculated, and find what you’ll be paying each month on
a given car!

Car Loans Payment Equation

Car Loan Payment Equation

What is a Monthly Car Loan Comprised of?


What does Principal mean?

The total amount borrowed

  • +Vehicle cost
  • +Lender or dealership fees
  • +Additional options & add-ons

What does a Term mean?

The time used to pay back a loan

  • AKA: Amortization
  • Often 72-84 months long
  • Arrange in 6-month increments
Interest Rate

What does Interest Rate mean?

The cost of borrowing money

  • AKA: Annual Percentage Rate (APR)
  • Derived from loan term, vehicle, and borrower's financial circumstances

When you apply, you need:

  • Proof of Income: $2000/month for at least 1 month

  • Driver's License: Ability to legally drive

  • Bank Account: Pre-authorized debit

  • Down Payment: Increase for easier loan approval depending on vehicle

  • Residence Details: Current Address, monthly rent, mortgage payment

  • Contact Info: Name, D.O.B, phone number, email, etc.

  • Credit Check: accepts all kinds of credit!

Email Address
Please Wait