Work backward from a comfortable monthly payment to the price you can afford.
A vehicle affordability calculator works backward from a monthly payment you're comfortable with to the total vehicle price you can afford, accounting for your down payment, trade-in, loan rate, term, and sales tax.
Dealers often steer the conversation to the monthly payment, which can hide a high price stretched over a long term. Flipping it around, deciding what monthly payment fits your budget first, then solving for the price, keeps you in control. A common guideline is to keep total car costs, including insurance and fuel, well within a modest share of take-home pay, but the right number is whatever leaves room for your other goals.
Stretching a loan to 72 or 84 months lowers the monthly payment but raises the total interest and keeps you 'underwater', owing more than the car is worth, for longer, since cars depreciate faster than a long loan pays down. A larger down payment or a shorter term costs more per month but far less overall. Factor in insurance, fuel, and maintenance too; the payment is only part of what a vehicle actually costs.
Start from a monthly payment that fits your budget, then work back to a price. Enter your payment, down payment, rate, and term above to see the total you can afford.
More is better, a larger down payment lowers the loan, reduces interest, and helps you avoid owing more than the car is worth. Around 20% down on a new car is a common target.
It lowers the payment but raises total interest and keeps you underwater longer, since cars depreciate quickly. A shorter term costs more monthly but far less overall.
See the exact formula and a worked example on our methodology page.