Residual-Value (Balloon) Car Loan Calculator
Enter the vehicle price, down payment, residual value, annual interest rate, and number of payments to instantly calculate a residual-value (balloon) car loan: the monthly payment, the final balloon (residual) payment, the total payment, and the total interest. Because interest is charged on the balance including the residual, this uses a dedicated balloon formula and also shows a year-by-year table of principal, interest, and balance.
Input
× 10k
× 10k
× 10k
%
mo
Result
Monthly payment (60 payments)
$36,969.00
A final balloon of $1,200,000.00 (the residual) is due at the end
Final balloon (residual)
$1,200,000.00
Total interest
$418,110.00
Total payment
$3,418,110.00
Year-by-year breakdown
| Year | Principal | Interest | Payment | Balance |
|---|---|---|---|---|
| Year 1 | $332,530.00 | $111,098.00 | $443,628.00 | $2,667,470.00 |
| Year 2 | $345,734.00 | $97,894.00 | $443,628.00 | $2,321,736.00 |
| Year 3 | $359,461.00 | $84,167.00 | $443,628.00 | $1,962,275.00 |
| Year 4 | $373,733.00 | $69,895.00 | $443,628.00 | $1,588,542.00 |
| Year 5 | $388,542.00 | $55,056.00 | $443,598.00 | $1,200,000.00 |
How it works
- A residual-value (balloon) car loan defers a preset future trade-in value—the residual—to the end of the term and amortizes only the vehicle price minus that residual through the monthly payments. At the end you can pay the residual to keep the car, return it, or trade it in for a new one.
- Unlike a regular car loan, the monthly payments only pay down the non-residual principal, but interest is charged on the entire outstanding balance including the residual. So a larger residual lowers the monthly payment but raises the total interest.
- The monthly payment is solved as a balloon so the balance lands exactly on the residual at the final payment: monthly payment = (financed − residual ×(1+r)^−n) × r ÷(1 −(1+r)^−n), where r is the monthly rate (annual ÷ 12) and n is the number of payments. When the rate is 0%, it is (financed − residual) ÷ n. Financed = price − down payment.
- Each payment's interest = balance × monthly rate (rounded to the nearest unit) and principal = payment − interest, with any remainder settled in the final payment so the post-payment balance equals the residual exactly. Total payment = down payment + sum of monthly payments + residual (if you buy the car out).
- The residual cannot exceed the financed amount (larger inputs are capped). Actual residual values are set by the dealer based on the model, mileage, and term, and returning the car may incur charges for excess mileage or damage.
- Assumes a fixed rate for the whole term and ignores bonus payments, early repayment, fees, and insurance. Results are rounded approximations; actual amounts depend on the finance company's calculation and rounding. Make any financing decision at your own discretion.
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Residual-Value (Balloon) Car Loan Calculator