Car Payment Calculator
Estimate monthly car payments with price, down payment, and loan details.
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How Much Car Can You Afford?
The 20/4/10 rule is a practical guideline:
- Put at least 20% down
- Finance for no more than 4 years
- Keep total car costs (payment + insurance + gas + maintenance) under 10% of gross monthly income
On a $60,000 gross annual salary ($5,000/month), that means total car costs under $500/month. If insurance and gas cost $250/month, your max payment would be $250.
This rule is conservative -- many people spend more and manage fine. But stretching too far on a car (a depreciating asset) limits money available for savings and investments.
For a more detailed calculation including trade-in value, sales tax, and payment comparisons across different loan terms, see our auto loan calculator.
When to use this
You're browsing car listings and see something for $32,000. Before you get emotionally attached, you want to know what that actually costs per month — and what the total damage is after interest. Enter the price, your planned down payment, the interest rate you expect to qualify for, and the loan term. In seconds you'll see the monthly payment, total interest, and the real cost of that car.
This is also the tool for budget-first shopping. If you know you can afford $450 a month, work backwards: adjust the vehicle price, down payment, and term until the payment fits your budget. It's a much better approach than falling in love with a car and then figuring out financing later, when the pressure to make it work clouds your judgment.
Use it to compare new vs. used, or to see how a higher down payment changes the math. A used car at $18,000 with a slightly higher rate may still cost less per month and in total than a new car at $30,000 with a promotional rate. The numbers tell the real story.
Good to know
Monthly payment = P[r(1+r)^n] / [(1+r)^n - 1]. P is the amount financed (price minus down payment), r is the monthly rate (APR / 12), and n is total months. A $28,000 loan at 6% for 60 months works out to $541/month, with $4,480 in total interest.
Every $1,000 in down payment saves more than $1,000. On a 60-month loan at 6%, an extra $1,000 down saves $1,000 in principal plus about $160 in interest — $1,160 total. On a 72-month loan at 7%, that same $1,000 saves nearly $1,240. The longer the term and higher the rate, the more a down payment is worth.
Dealer financing isn't always the best deal. Manufacturers sometimes offer 0% or low-rate promotional financing, but often only on specific models and to buyers with excellent credit. Compare the dealer's offer against a credit union or bank pre-approval. Sometimes a manufacturer rebate (cash discount) plus outside financing beats 0% with no rebate.
Don't forget the hidden costs. Your monthly car budget should include insurance (often $150–$300/month for full coverage), fuel, and maintenance. A car with a $500 payment that requires premium fuel and expensive maintenance can cost the same as a $600 payment on a reliable, fuel-efficient model.
Quick Reference
| Car Price | Down Payment | Rate | Term | Monthly Payment | Total Interest |
|---|---|---|---|---|---|
| $20,000 | $4,000 (20%) | 5.5% | 48 mo | $372 | $1,840 |
| $28,000 | $3,000 (11%) | 6.0% | 60 mo | $483 | $3,980 |
| $35,000 | $7,000 (20%) | 6.5% | 60 mo | $548 | $4,880 |
| $35,000 | $5,000 (14%) | 7.0% | 72 mo | $512 | $6,860 |
| $45,000 | $9,000 (20%) | 5.9% | 60 mo | $696 | $5,760 |