Trade-in and the amount financed

Trade-in lowers the price before tax and lowers the loan. It is a dollar credit, not a monthly payment.

One number, two effects

Subtracting the trade-in from the price lowers the sales tax, because tax uses price minus trade-in. The same trade-in is also subtracted when the loan is built.

You type the trade-in allowance you were offered. The calculator does not appraise the old car.

What is not modeled

A loan still owed on the old car is not added automatically. If you are upside down and the dealer adds that payoff to the new loan, add it to the price you type, or the new loan on this screen will be too small.

A trade-in larger than the price zeroes the tax. The loan can still exist if the down payment does not cover the rest, but a trade-in above the price reduces the loan the same way cash would.

Keep it out of the payment

Do not divide the trade-in into a monthly credit. It is applied once, at the start. The monthly car total is the new loan plus ownership.

Compare two deals by changing trade-in, price, rate, and term, and reading the payment and the interest. The offer box compares two rates on the loan you have already built.

This explains how WiseCalculator treats the numbers you type. It is not a lender’s offer and it is not advice for your loan.