The car price your income supports at a payment cap — loan, down payment and trade-in.
15% is a common guideline for the car payment alone; the 20/4/10 rule caps it at 10% with 20% down over 4 years.
Reality check: debts reduce what is left after the car payment.
Affordability guideline only — not a loan offer. Insurance, fuel, maintenance and taxes are extra; lenders also check credit and debts.
total car price you can afford
How to use this tool
Type pre-tax monthly income, or household income if buying jointly.
15% is a common ceiling for the payment alone; try 10% for the stricter 20/4/10 rule.
Type cash down plus any trade-in value — both reduce the loan you need.
Type the APR you expect and the term. Shorter terms cost less interest but need a bigger monthly payment.
Formula & worked example
Worked example: income $6,000, 15% cap = $900 a month, 7% APR, 60 months. The loan supported is $900 × (1 − 1.005833^−60) ÷ 0.005833 = $45,451.79; plus $5,000 down and $2,000 trade-in, the affordable car price is $52,451.79, with total payments plus down/trade-in of $61,000 over the loan.
Limitations — read this before you rely on it
Guideline only. It excludes insurance, fuel, maintenance, registration and sales tax, which can add hundreds a month; it assumes a fixed APR and approval at the cap, and it ignores your credit score and total debt load. The 20/4/10 rule (20% down, ≤4-year term, payment ≤10% of gross) is stricter than the 15% default here.
Frequently asked questions
A common guideline caps the monthly payment at 10–15% of gross monthly income. This calculator turns that cap into a car price via the loan maths.
Put 20% down, finance for no more than 4 years, and keep the payment (plus insurance) under 10% of gross income. It is stricter — and safer — than a 15% payment cap.
Yes, in your own budget: insurance, fuel and maintenance are real car costs on top of the payment, and some guidelines count insurance inside the 10%.
It lowers the payment but raises total interest and risks owing more than the car is worth. Compare total cost, not just the payment.
No. Lenders check credit, total debts, employment and the car's value; the cap here is a budgeting guideline, not an approval.