What’s a Reasonable Car Payment?

Whether you’re tired of spending money monthly on car repairs on your current car, are purchasing your first car, or are tired of purchasing used cars off of Marketplace and Craigslist that don’t last long, you’ll probably wonder what’s a reasonable car payment when you consider purchasing a car from a car dealership. 

Understandably, especially with gas and food prices currently on the rise, you don’t want to add on another recurring monthly payment that you may not be able to afford. 

This post is going to help you determine how much you can afford to spend on a new car

What's a Reasonable Car Payment?

Know your credit score

While there isn’t a magic credit score for determining whether or not you are approved for a car loan, you want to make sure that you have a good credit score to get the best interest rate. 

While those who have poor or fair credit scores can be approved for auto loans you’ll get fewer offers and higher interest rates.

Therefore, before you even start thinking about adding a car payment to your recurring monthly bills, it’s important to know your credit score. 

If possible, if your credit score is below 660, try to increase your score before applying for a car loan. 

Consider your income

What’s considered a reasonable car payment for one person, may not be a reasonable car payment for the next person. 

There’s no universal reasonable car payment. 

Instead, you have to consider your income, to determine what is a reasonable car payment for you. 

Ideally, when buying a new car, you’ll want to make sure that your car payment is no more than 10% of your monthly take-home income. 

Keep in mind that the are other reoccurring car expenses that you’ll also need to add to your monthly budgets such as car insurance, taxes, gas, and maintenance. 

Use a car payment calculator

An easy way to determine what’s a reasonable car payment for you is to use a car payment calculator.

You’ll be able to get an estimate of how much your monthly payment will be based on various factors such as purchasing a new car vs purchasing a used car and trade-in vs no trade-in. 

If you use CarPaymentCaclulator.net, you can even enjoy some arcade games after getting all of your estimates. 

Final Thoughts

While there isn’t a universal reasonable car payment, reasonable car payment for you would be no more than 10% off your take-home income. 

Keep in mind that you’ll also be adding on additional recurring car expenses when purchasing a car. 

What\'s a Reasonable Car Payment?


  1. Interesting insights that everyone should follow before owning a car. Thanks for it.

  2. Marysa says:

    We actually just bought two new cars, because our old cars just couldn’t make it any longer. Fortunately we have good credit, so buying two was not an issue.

  3. Catalina says:

    A car is a need nowadays. But I don’t like to spend too much on it!

  4. The car payment calculator looks like a handy tool! I hope to buy a new vehicle in a couple of years.

  5. Rosey says:

    I was going to level up on my car. I keep getting emails from the dealer that sound too good to resist. I reassed though and decided not to buy at this time. I am half way through payments and would like to get that out of the way and rest from them entirely for a bit.

  6. Hannah Bures says:

    My husband and I will be reviewing this when we go to get our new (to us) car! Finances are not my strong suit!

  7. Amber Myers says:

    I always have an idea in mind of what I won’t pay more of. That’s how I know if I need the car or not.

  8. Janis says:

    That’s a very good question for those considering a car purchase. Personally, whether buying new or used, I always have opted for saving up for a car and paying cash before I buy it, so I don’t have to worry about monthly payments after I drive off the lot.

  9. Melanie Edjourian says:

    All of these are important factors to consider. It’s important to make sure you can afford it.

  10. Katie C says:

    Thank you for not just stating a specific number here! It’s so important for everyone to analyze their own financial situation to figure out what will be reasonable for THEIR situation and their income. Great tips!

  11. Tammy says:

    This is a great post. Its so important to realize how much money you can spend before buying a car.

  12. Richelle Milar says:

    These are all really important things to consider before buying a new car! Thanks for sharing this

  13. Claudia says:

    Owning a car is a big decision to make. But I guess a car payment calculator is a good start to help you.

  14. Ivan Carlo Jose says:

    I’d always suggest this to people who are thinking of getting a car loan. They should calculate their monthly amortization based on their financial capacity.

  15. Libby says:

    Not to mention the monthly car payment may vary depending on the down payment given at the start of the transaction in addition to credit score!!

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