: The cost of borrowing that money, which is typically calculated daily based on your remaining balance.
: Some experts, like those at Edmunds , suggest your car payment alone should not exceed 15% of your take-home pay . Key Components of Auto Debt auto debt
: A more common guideline recommending a 20% down payment , a 4-year loan term , and a total transportation cost (including insurance and maintenance) of no more than 10% of your gross income . : The cost of borrowing that money, which
: This conservative approach suggests you put 20% down , finance for no more than 3 years , and keep your monthly payment at or below 8% of your gross income . : This conservative approach suggests you put 20%
Financial experts use different "rules of thumb" to define manageable auto debt:
: The actual amount of money you borrow to buy the car after your down payment.
