Car Depreciation & Loan Equity Calculator
Stress-test an entered vehicle value against the remaining auto loan, with separate first-year and later loss assumptions.
Your inputs
Use consistent units and periods. Defaults are examples.
Your result
Check the assumptions below before relying on a result.
Formula and method
At month m, scenario value = max(floor, starting value × (1−first-year loss)^[min(m,12)/12] × (1−later annual loss)^[max(m−12,0)/12]). Net equity = scenario value − remaining scheduled loan principal. Month zero is included; all losses are entered by you. First non-negative observation, first recovery after a negative observation, and first later negative crossing are reported separately.
Worked example
A starting value of 30,000 with a 20% first-year loss becomes 24,000 at month 12. A 10% later annual loss produces 21,600 at month 24. If a zero-rate 24,000 loan has 24 months left, its balance at month 12 is 12,000 and scenario equity is 12,000.
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Open calculator ↗How to use this result
- Enter today’s vehicle value and loan balance at the same date.
- Choose first-12-month and later annual loss rates from your own scenarios.
- Inspect the monthly value-versus-debt chart and exact equity table.
- Test a higher loss rate and a lower floor before using the horizon value in lease-versus-buy.
Questions about this calculation
Are these typical market depreciation rates?
No. Every rate is a user-entered assumption. Defaults are examples, not a market forecast.
Is the first year the vehicle’s first year when new?
No. It is the next 12 months from the starting value you enter.
Does non-negative equity mean selling has no cost?
No. Selling fees, taxes, condition adjustments and any payoff difference can change the net proceeds.