Find out how much car you can afford from the monthly payment you're comfortable with. Enter your target payment, loan term, rate, down payment, and trade-in to see your maximum car price.
Max price from your payment
Instead of starting with a car price, this tool works backward from the monthly payment you're comfortable with. It calculates the maximum loan that payment can support at your rate and term, then adds your down payment and trade-in to find your total buying power — and backs out sales tax to give the sticker price you can actually afford. A common guideline is to keep your total car costs (payment, insurance, fuel, maintenance) under about 15–20% of your take-home pay.
For example, a $450/month budget over 60 months at 7% APR supports a loan of about $22,700. Add a $3,000 down payment and you can afford a roughly $25,700 car (before tax). Shortening the term raises the payment but cuts interest; lengthening it lowers the payment but you pay more interest and risk being "upside down." Use this to shop with a firm number in mind and avoid dealer payment-stretching.
Pick a comfortable monthly payment; the tool finds the car price it supports — not the other way around.
Put 20% down, finance no longer than 4 years, and keep total car costs under 10% of gross income.
72- and 84-month loans lower the payment but pile on interest and leave you owing more than the car's worth.
Car affordability is best approached from total transport cost rather than the monthly payment, because the payment is roughly half of what a vehicle actually costs to run. The widely-cited 20/4/10 guideline captures this: put 20% down, finance for no more than 4 years, and keep total transport costs — payment, insurance, fuel and maintenance — under 10% of gross income. The four-year limit matters as much as the percentage, because it forces the loan to amortize faster than the car depreciates, which is what prevents negative equity.
Max total transport = Gross monthly income × 10%Max payment = Max total transport − insurance − fuel − maintenanceMax loan = Payment × [ (1+i)^n − 1 ] ÷ [ i(1+i)^n ]Max price = Max loan + down paymentwhere:
Assumptions: A guideline, not a lending limit — dealers will approve far more. Excludes depreciation, which is the largest cost of all but is not a cash outflow until you sell.
Work from income to total transport budget, then to a purchase price.
ResultAbout $23,100 — a $363 payment, not the $600 a dealer would approve
A lender would likely approve double this, because lenders test the payment against income and ignore fuel, insurance and maintenance entirely. The gap between what you can borrow and what you can afford is the whole point of the 20/4/10 rule.