Using Our Car Loan Affordability Calculator
This calculator is designed to give you some idea about how much you could afford to spend on a new car.
The first step is to enter the details of how much you could afford each month in payments, and the proposed car loan variables in the fields to the left:
- Max Payment/mo - The maximum you could afford to pay every month on your loan
- Down Payment - The amount of money that you will be putting down yourself on the car
- Trade In - If you will be trading in your current car, put it's expected value here
- Owed on Trade - If you will be trading in and owe money on that vehicle, enter the amount here
- Interest Rate - The interest rate or annual percentage rate (APR) that you will pay on the loan
- Sales tax - The amount of sales tax levied in your area
- Term (Months) - The number of months that your loan will run over, typical terms for a car loan are 36, 48 or 60 months
Once you enter your details click "Calculate" and the calculator will provide your results.
Understanding the Results - Affordability Summary
This table provides four pieces of information:
- Spending Limit - This is how much you could afford to spend on a car, the amount includes your down payment and trade in
- Loan Amount - The amount that could be borrowed given your maximum repayments, interest rate and loan term
- Down Payment - The amount of money you will add to the loan amount
- Trade In Value - The amount that you will get for trading in your current vehicle which is added to the spending limit
While this calculator can give you a good idea about how much you could potentially spend on a car, it should not be relied upon to make your final purchasing decision. Always consider your personal financial position before borrowing money or making large purchasing decisions.