Car Affordability Calculator
The Car Affordability Calculator works from your monthly car budget, down payment and trade-in to find the maximum vehicle price you can afford at a given APR and term.
What this means
A common guideline is to keep total car costs under 10% of your gross income and avoid terms longer than 60 months. This calculator ensures your budget, not the dealer, sets the price ceiling.
How we calculate it
Formula
Financed amount = budget supported by payment formula + down payment + trade-in = max price.Worked example
$400/month budget, $3,000 down, $2,000 trade-in at 5% for 60 months:
- 1Max financed ≈ $21,196
- 2Max price ≈ $21,196 + $3,000 + $2,000 = $26,196
Important assumptions
- The APR is fixed for the full term.
- Taxes and fees on the car price are excluded.
Frequently asked questions
How much car can I really afford?
A conservative rule is no more than 10% of gross income toward total car costs and a loan no longer than 60 months. Your exact budget depends on your other obligations.
Is a longer term a good way to afford more car?
Longer terms lower the payment but add interest and increase the risk of owing more than the car is worth. Prefer a larger down payment over a longer term.