Canada Car Loan Calculator

Canadian car loans typically run 5-7 years (60-84 months), with rates 6-9% for prime credit and 11-15% for subprime in early 2025. A $40,000 loan at 8% over 60 months has a monthly payment of $811 and total interest of $8,684. Stretching to 84 months drops the monthly to $623 but pushes total interest to $12,344 - $3,660 more for the same car.

GST/HST on the vehicle is paid at purchase (5-15% depending on province) and usually rolled into the loan. So a $40,000 vehicle in Ontario actually finances around $45,200 (with 13% HST) before any extras. Always confirm whether quoted prices are pre-tax or post-tax when comparing dealer offers.

Credit score is the biggest factor - Canadian credit ranges 300-900, with 700+ getting prime rates, 650-700 fair, below 650 subprime. Income and employment stability matter too. Larger down payments (25-30%) sometimes secure slightly better rates than 0-10% down. Rates also vary by lender type: credit unions often beat banks by 0.5-1.5%; dealer financing often the worst.

New vs used: new vehicles get 1-2% lower rates than used at the same lender. Lease deals sometimes carry promotional rates (0-3%) for new vehicles, which can beat purchase loans short-term. The gap compresses over the loan/lease life - lease lower payments don't translate to lower total cost.

Get pre-approved by your bank or credit union before visiting dealers. The pre-approval gives you a benchmark rate and removes the dealer's biggest profit lever (financing markup). Dealers often add 1-3 percentage points to whatever rate the lender approves you at. With a credit union pre-approval at 7%, you can compare any dealer offer head-on.

Many credit unions in Canada offer 0.25-0.5% rate discounts to existing members or for setting up auto-pay. Cash-back cards on the down payment can recoup 1-2% effectively. None of these are huge individually but they stack to meaningful savings on a 5-year loan.

Total ownership cost includes: monthly loan payment, insurance ($800-3,000/year depending on age, driving record, province - Ontario and BC are highest), gas (varies by efficiency and driving), maintenance ($800-1,500/year typical), licensing ($120-200/year). A $40,000 financed vehicle often costs $700-900/month all-in.

Provincial sales tax on private vehicle sales differs from dealer sales. Ontario charges 13% HST on private sales (same as dealer). BC charges 12% PST on private sales (vs 7% PST + 5% GST = 12% on dealer purchase but only PST on private). Check your province's rules before assuming a private sale saves on tax. The [Canada Income Tax Calculator](/canada-income-tax-calculator) covers personal tax integration.