$500/mo, 7.5% APR, 60 mo, $4k down, 7.5% tax, $800 fees, no trade
- Max loan ≈ $24,953; price before tax ≈ $26,189; price with tax ≈ $28,153
- Total interest ≈ $5,047 over the term
finance calculator
Car Affordability Calculator
Back into the maximum car price you can afford from your target monthly payment, rate, term, down payment, tax, fees, and trade-in.
Results
- Max vehicle price (before tax/fees)
- $26,189
- Price with tax
- $28,153
- Max loan amount
- $24,953
- Target payment (entered)
- $500
- Total interest (loan term)
- $5,047
How to use this calculator
- Enter your target monthly payment, APR, and term.
- Enter down payment, sales tax rate, and estimated fees.
- Add your trade-in value and any remaining loan on it (if underwater, enter payoff to include negative equity).
- Review the maximum vehicle price, loan amount, and total interest that fit your budget.
Inputs explained
- Target payment
- What you can afford per month for principal and interest.
- APR/term
- Rate and loan length; longer terms lower payment but can raise total interest.
- Down payment
- Cash you’ll put down to reduce the financed amount.
- Sales tax & fees
- Tax rate in your state plus dealer/title/doc fees.
- Trade-in value/payoff
- Positive equity lowers financing; negative equity raises it if rolled in.
How it works
We solve for the loan amount that fits your target monthly payment at the given APR and term using the standard amortization formula.
Then we add down payment and trade-in equity (or subtract negative equity) and remove fees/tax to back into the pre-tax vehicle price.
Outputs include max vehicle price before tax/fees, price with tax, loan amount, and total interest over the term.
Formula
Loan amount from payment: P = Payment × (1 − (1+r)^{−n}) / r, where r = APR/12, n = term months (or Payment × n if r = 0).
Price pre-tax = (Loan + Down + Trade equity − Fees) ÷ (1 + Tax rate), where Trade equity = Trade value − Trade payoff.
Total interest = Payment × n − Loan amount.When to use it
- Setting a realistic budget before visiting a dealership.
- Comparing different term lengths to keep payment in range.
- Seeing how more down payment or a higher trade-in offer raises your max price.
- Checking impact of negative equity on what you can afford.
Tips & cautions
- Shorter terms cost less interest; don’t chase the lowest payment if it stretches the term too far.
- Use conservative tax/fee estimates to avoid surprises in the finance office.
- If you have negative equity, consider paying it down separately instead of rolling it into the new loan.
- Shop APRs with a preapproval—small rate drops can meaningfully raise the affordable price.
- P&I only; does not include insurance, fuel, or maintenance—add those to your budget separately.
- Assumes taxes apply to the purchase price; local tax rules may differ (trade-in credits vary by state).
- Assumes fees are paid upfront; financing fees would slightly change the max price.
- Does not include rebates or incentives—subtract them from the price externally if applicable.
Worked examples
$650/mo, 6.25% APR, 72 mo, $2.5k down, 8.5% tax, $1,200 fees, $4,500 trade with $2,000 payoff
- Trade equity = $2,500
- Max loan ≈ $38,943; price before tax ≈ $39,394; price with tax ≈ $42,743
- Total interest ≈ $7,857 over the term
Deep dive
This car affordability calculator backs into the maximum car price you can afford from your target monthly payment, APR, term, down payment, tax, fees, and trade-in details.
Use it before heading to the dealership to set a firm budget and see how down payment, trade equity, and rate/term changes affect the price you can afford.
FAQs
- Does this include insurance or fuel?
- No. This models principal and interest. Budget separately for insurance, fuel, and maintenance.
- What about rebates?
- Subtract rebates from the price manually to see how they increase your affordability headroom.
- How is negative equity handled?
- Enter your trade payoff; negative equity reduces the affordable price because it increases financing.
- Are taxes exact?
- Taxes vary by state and may credit trade-ins differently. Use your local rate and adjust if your state taxes after trade credits.
- Can I finance fees?
- This assumes fees are paid upfront. If you finance them, the effective affordable price drops slightly.
Related calculators
Estimates only. Taxes, fees, trade-in credits, and lender terms vary by state and dealer. Verify details with your lender/dealer before purchasing.