Car Affordability Calculator: Price, Payment and Budget

How the car affordability estimate works

The calculator first limits total monthly vehicle cost to the lower of two amounts: your selected share of take-home income, or the cash remaining after other commitments. It then subtracts insurance, fuel or charging, maintenance, registration, parking and other recurring costs. The remainder is the maximum loan payment used to solve for a loan principal.

Monthly vehicle budget = min(income × selected percentage, income − other commitments)
Payment budget = vehicle budget − recurring ownership costs
Loan principal = payment × [1 − (1 + monthly rate)^−months] ÷ monthly rate

With a zero rate, the maximum principal equals the payment budget multiplied by the number of months. The vehicle price is then solved from the principal after the down payment, trade equity, tax and financed fees. Negative trade equity reduces the affordable price.

Example

With 6,000 of monthly take-home income, 3,600 of other commitments, a 15% total-vehicle limit, 440 of recurring vehicle costs, a 6.5% APR, 60 months, 4,000 down, a 5,000 trade with 2,000 owed, 7% tax and 800 of financed fees, the tool reserves 900 per month for the vehicle and 460 for the loan payment. The exact maximum price is calculated from those inputs.

Important limits

This is a planning estimate, not a lender approval or financial recommendation. It does not know your credit score, lender debt-to-income rules, taxes on rebates or trade-ins, dealer products, changing insurance premiums, depreciation, repairs or the true value of a specific vehicle. Verify tax treatment and fees for your jurisdiction and leave room for unexpected costs.

Related calculators

Already know the vehicle price? Use the Auto Loan Calculator for payment, tax, trade-in and extra-payment details. Estimate retained value and ownership loss with the Car Depreciation Calculator. To compare leasing, use the Car Lease Calculator. For a whole-household view, use the Budget Calculator.