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For $40,000 loans, monthly payments averagely range between **$900 and $1,000**, depending on the interest rate and loan term.

Your monthly payments would look like this for a $40,000 loan: **36 months: $1,146**. 48 months: $885. 60 months: $737.

A $30,000 car, roughly **$600 a month**.

Expert estimates range broadly. Greg McBride, a senior vice president, chief financial analyst at Bankrate.com, advises that a car payment should equal **no more than 15 percent of your pretax monthly pay**. That means that if you make $50,000 a year, your monthly car payment could be as much as $625.

- 2022 Honda Civic. Payment: $280 / month Lease Term: 36 months MSRP: $23,645. ...
- 2023 Kia Seltos. ...
- 2022 Honda HR-V. ...
- 2022 Toyota C-HR. ...
- 2022 Mazda Mazda3. ...
- 2022 Mitsubishi Mirage. ...
- 2022 Toyota Corolla Cross. ...
- 2022 Toyota Corolla Hybrid.

According to experts, a car payment is too high if the car payment is **more than 30% of your total income**. Remember, the car payment isn't your only car expense! Make sure to consider fuel and maintenance expenses. Make sure your car payment does not exceed 15%-20% of your total income.

The result is that **the car will be a lot more expensive in the end**. In the example we've given, a car payment of $400 per month for five years (60 months) equates to $24,000. But the same $400 per month spread out over six years (72 months) is $28,800, while it's $33,600 over seven years (84 months).

The average monthly car payment was **$644 for a new vehicle and $488 for used vehicles** in the U.S. during the fourth quarter of 2021, according to Experian data. The average lease payment was $531 a month in the same period.

If you're in the market for a new car, you might be asking yourself — how much is the average car payment? Experian reports that, as of the second quarter of 2020, new vehicle owners paid an average of **$568 a month** on their vehicles, while used car owners paid $397.

When browsing your options, keep in mind that financial experts will typically tell you to spend less than 10% of your monthly take-home pay on your car payment. That means **if your take-home pay is $3,000 a month, plan to spend no more than $300 on your car payment.**

It's typically recommended that you buy a car worth no more than 35% of your gross annual income— so if you make $60k per year, you can afford a new car that is worth **$21,000 or less**.

- Talk to the lender. This strategy can be best for when you're having temporary trouble making payments. ...
- Refinance. ...
- Sell the car yourself (and buy a cheaper one) ...
- Trade it in to a dealership. ...
- Lease a car. ...
- Lower your amount financed. ...
- Shop for a low APR. ...
- Get a longer loan term.

**The average new car payment in America has crept above the $500 per month mark for the fist time**, settling in at $503, according to a recent study by Experian. And if that weren't bad enough, the average length of a car loan now stands at 68 months.

Experts say **your total car expenses, including monthly payments, insurance, gas and maintenance, should be about 20 percent of your take-home monthly pay**. For non-math wizards, like me – Let's say your monthly paycheck is $4,000. Then a safe estimate for car expenses is $800 per month.

NerdWallet recommends spending **no more than 10% of your take-home pay** on your monthly auto loan payment. So if your after-tax pay each month is $3,000, you could afford a $300 car payment.

The 50% rule

Some experts believe that spending **50% of your salary** on a vehicle should be affordable. With a salary of $75k this would give you $35,000 to spend on a car which is enough for a brand new car.

Experts recommend that you spend **$5,000 to $10,000** on your first car. But honestly, it all comes down to what you can afford. Here are a few simple tips to help you calculate a figure that would work well for you: Don't spend more than 15% of your gross pay or 20% of your take-home pay.

“**It's the single worst financial decision millennials will ever make**.” That's because the moment you drive it off the lot, the vehicle starts to depreciate: Your car's value typically decreases 20 to 30 percent by the end of the first year and, in five years, it can lose 60 percent or more of its initial value.

The monthly payment on a $45,000 loan ranges from **$615 to $$4,521**, depending on the APR and how long the loan lasts. For example, if you take out a $45,000 loan for one year with an APR of 36%, your monthly payment will be $$4,521.

**Paying cash for your car may be your best option if the interest rate you earn on your savings is lower than the after-tax cost of borrowing**. However, keep in mind that while you do free up your monthly budget by eliminating a car payment, you may also have depleted your emergency savings to do so.

**The larger the down payment, the lower your monthly payment will be—and you'll probably get a better interest rate, to boot**. The general rule is that your payment will drop about $20 a month for every $1,000 you put down, based on a 5% APR, but this is subject to individual situations and loan terms.

Having a 700 credit score puts you in the “prime” category for borrowing. According to Experian, the average rates for this category are **3.51% for new-car loans and 5.38% for used-car loans**.

For instance, using our loan calculator, if you buy a $20,000 vehicle at 5% APR for 60 months the **monthly payment would be $377.42** and you would pay $2,645.48 in interest.