QOTD #19 : How can I get to a $300/mo car payment?

After careful consideration, you have $300 per month to finance your next car. How much of a car can you afford? Quite often, customers contact us expecting to finance a $30,000 vehicle for $300/mo.  While that would be a very good deal, it just isn’t realistic. Do the math. Sixty payments of $300 per month totals $18,000 before taxes, interest, and fees. You would actually need more than $16,000 as a down payment to get to a $300 monthly payment on a $30,000 car. And most people are not prepared to put down that much money. While you may feel a bit disappointed or even cheated at the dealership, the truth is that a little homework will save you a some embarrassment.

For example, let’s say that you are looking for a $300 payment including all taxes, fees, discounts, etc. You have $2000 to put down and want a 60 month loan and a 4.99% interest rate. Assuming that your credit score is 730 or better, how much car can you afford to finance?

Using the USBank auto loan calculator, you’ll quickly find the answer.

Is that different than you were thinking? If so, you may want to use the calculator before giving the evil eye to your local car salesman.