Car Loan Over 3, 5 or 7 Years: How Much More the Long Term Costs
Monthly repayments and total interest on a $40,000 car loan at two rates and three terms, and the extras that change the real cost.
By the MoneyBackKit AU team · Updated 28 October 2026 · 2 min read
Car loans are sold on the weekly or monthly repayment. Stretching the term to 7 years makes the repayment look small, but you pay interest for longer on a car that's losing value every year.
A $40,000 car loan over 3, 5 or 7 years
| Rate | Term | Monthly | Total interest | Total paid |
|---|---|---|---|---|
| 7.5% | 3 years | $1,244 | $4,793 | $44,793 |
| 7.5% | 5 years | $802 | $8,091 | $48,091 |
| 7.5% | 7 years | $614 | $11,537 | $51,537 |
| 10.5% | 3 years | $1,300 | $6,804 | $46,804 |
| 10.5% | 5 years | $860 | $11,585 | $51,585 |
| 10.5% | 7 years | $674 | $16,652 | $56,652 |
Things that change the real cost
- Compare the comparison rate, not just the headline rate; it includes most fees.
- A balloon (residual) payment lowers repayments but leaves a lump sum at the end, and you pay interest on it the whole time.
- Dealer finance may come with a low rate but a higher car price. Get a price for paying cash too.
- Check whether you can make extra repayments or pay out early without a fee.