Out-the-Door Price vs. Amount Financed
Follow a purchase price through taxes, fees, down payment and trade equity to the loan amount.
The out-the-door price tells you the purchase total. The amount financed tells you how much you borrow. A down payment or trade-in can change the loan without changing the vehicle’s selling price.
By MyAutoPlace. Editorial review: . For U.S. consumers. Educational information, not personalized legal or financial advice.
Selling price, out-the-door price and amount financed
For this guide, selling price is the agreed vehicle price after included discounts. Out-the-door price adds quoted tax, title, registration, dealer fees and selected products, before cash down and trade equity. Amount financed is the borrowing shown in the lender’s disclosure; reconcile any separate financing charges with that document.
Ask for an itemized written total rather than comparing advertised prices alone. The FTC recommends getting an out-the-door quote before visiting a dealer.
Source: FTC: written purchase quotes.
Follow a $25,000 vehicle through the quote
Suppose the agreed selling price is $25,000 and the quote includes $2,000 in combined taxes and fees. With no other charges, the purchase total is $27,000. A $5,000 cash down payment leaves $22,000 to borrow, assuming no trade or separate financing adjustments.
Enter $22,000 in the quick car payment calculator, not $25,000 or $27,000. Its amount-borrowed field does not automatically subtract your cash down or add taxes.
For a full breakdown, enter $25,000 selling price, the actual government charges and dealer fees in their separate fields, and $5,000 cash down in Advanced Deal Checker. Keep each charge in one place.
How much does a $5,000 down payment change the payment?
In the same fictional purchase, financing $27,000 at 6% annual interest for 60 months produces a payment of $521.99. Financing $22,000 at the same rate and term produces $425.32. The down payment reduces the monthly estimate by $96.67 and total interest by $799.84.
The $5,000 is still money you pay toward the purchase. To compare total cash paid in these examples, add cash down to total loan payments; do not mistake lower borrowing for a $5,000 discount. These calculations do not determine how much cash you should keep available for your other needs.
A trade allowance is not the same as trade equity
A $12,000 trade allowance with a $9,000 lender payoff creates $3,000 of positive equity. In the example above, applying it alongside $5,000 cash down leaves $19,000 to borrow. With a $14,000 payoff instead, the same trade has $2,000 of negative equity; if included in the new loan, borrowing becomes $24,000.
Those examples hold the quoted purchase charges constant. Tax treatment may differ by jurisdiction and transaction; obtain the actual quote. See our trade-in payoff and negative-equity guide for the separate steps of paying off the old loan.
Before comparing payments
- Confirm which discounts are already included in the selling price.
- Separate government charges, dealer fees and chosen products.
- Keep cash down separate from the trade allowance and payoff.
- Reconcile the calculated borrowing with the lender’s amount-financed disclosure.
- Compare interest rate, APR, term and total payments, not only the monthly figure.
Continue with the itemized dealer-quote walkthrough or loan-term comparison.