Dealers sell you a monthly payment. We show you the real number using the 20/4/10 rule — 20% down, a 4-year loan, and total car costs under 10% of your monthly income.
Run my numbers →Join the newsletterAccording to the 20/4/10 rule.
20% down · a 4-year loan · total car costs under 10% of your monthly income. This calculator sizes your loan payment to that 10% ceiling, minus your other car expenses, then works back to a max price.
Dealers anchor you on the monthly number. We work backward from what your budget can actually carry.
Long 72- and 84-month loans lower the payment but bury you in interest and negative equity. The rule caps you at a 4-year loan.
More down means a smaller loan, less interest, and instant equity — so you're never underwater on the car.
It follows the 20/4/10 rule: your total monthly car cost is capped at 10% of your monthly income, minus your other car expenses (gas, insurance, upkeep) to leave the affordable loan payment. That payment is converted into a loan amount over a 4-year term at your APR, then divided by 80% — because your 20% down payment covers the rest — to get the max car price.
A simple guideline for buying a car you can actually afford: put at least 20% down, finance for no more than 4 years, and keep your total monthly car costs — loan payment plus insurance, gas, and maintenance — under 10% of your gross monthly income.
Yes, when you can. A down payment shrinks the loan, cuts total interest, and protects you from owing more than the car is worth as it depreciates. Even 10–20% down makes a big difference.
No. It's an educational estimate to help you frame a decision. Your real budget depends on insurance, fuel, maintenance, and your full financial picture. Use it as a smart starting point, then adjust for your life.
Book a 1-on-1 with us to pressure-test the purchase against your budget, credit, and goals — before you sign anything.
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