A high car payment is generally considered one that consumes more than 10-15% of your gross monthly income or, when including insurance, gas, and maintenance, exceeds 20% of your take-home pay. For instance, if you make $4,000 gross, a payment over $400-$600 is high, while considering total costs, you should aim to keep it under $800. It's subjective, but a payment that strains your budget and leaves little for savings or emergencies is too high.
Strive for a car payment that does not exceed 15 percent of your net or take-home income. If you think your current car payment is too high, contact your lender to discuss your options or consider trading your vehicle in for something more affordable.
How much would a $30,000 car cost per month? This all depends on the sales tax, the down payment, the interest rate and the length of the loan. But just as a ballpark estimate, assuming $3,000 down, an interest rate of 5.8% and a 60-month loan, the monthly payment would be about $520.
By paying a little bit extra each month towards the principal balance, not only do you pay the car off sooner, but reduce the amount of interest paid back during the life of the loan.
Strategies to pay off your car loan faster
The 20/3/8 rule is a financial guideline for buying a car, suggesting you put 20% down, finance for 3 years or less, and keep total car expenses (payment, insurance, etc.) to 8% or less of your gross monthly income, aiming for reliable transport without overspending, and prioritizing investing over luxury car debt. It helps avoid being "upside-down" on a loan for a depreciating asset, promoting financial health over luxury.
A $40,000 car payment varies significantly by interest rate and loan term, but expect roughly $700-$900 monthly for 5 years at typical rates (6-10%), or potentially $1100+ for 3 years, or lower, around $400-$600, for longer 7-year terms, with actual costs including comparison rates, fees, and taxes making the total cost higher. A 5-year loan at 6% might be around $773/month, while a 3-year loan at 3% could be $885/month, but always check lender comparison rates for accuracy.
Australia's "25-Year Rule" allows importing classic and collectible vehicles (cars, motorcycles, light commercials) older than 25 years, under the Road Vehicle Standards (RVS) laws, by obtaining a Concessional RAV (Register of Approved Vehicles) approval to avoid strict compliance with modern Australian Design Rules (ADRs). This "rolling" rule means the vehicle must be at least 25 years old at the time of application, simplifying imports for enthusiasts but still requiring compliance with ADRs relevant to its original build year, plus some modifications for safety like VINs or child restraints.
For under $25k, top new car choices often include the Kia Picanto/Rio, Suzuki Swift/Ignis, Hyundai Venue, and MG ZS/MG 5, offering great value with modern tech and safety, while used options open up reliable models like the Toyota Corolla, Mazda CX-3, and Mitsubishi ASX, alongside performance used cars like older Ford Mustang GTs for driving enthusiasts. The best choice depends on whether you prioritize new car warranty and features or more space/power in a used vehicle.
If you take out a $35,000 new auto loan for a 72-month term at 4.0% interest, then your monthly payment will be $547.58. Although your monthly payments won't change during the term of your loan, the amount applied to principal versus interest will vary based on the amortization schedule.
How to lower your monthly car payments
Understanding the 20/4/10 Rule
It suggests making a down payment of 20 percent, financing the vehicle for no more than four years, and keeping total transportation costs within 10 percent of monthly income.
Remember, the price of the car is an important factor that decides your car payment. If the car is expensive, the car payment will be high. The next step to avoid high car payments is paying as much as you can afford on the down payment. This will reduce the loan amount, and the car payments will be lower.
According to this guideline, your Car Loan EMI should ideally be less than 28% of your pre-tax income (we've fixed it as 20% in our calculator). Moreover, the total of all your loans (including home, car, personal, etc.) should stay below 36% of your pre-tax income.
The ten year rule refers to the residency limitation placed on criminal deportation in s. 201 of the Migration Act. Under existing law, once a "permanent" resident has lived in Australia for ten years he or she is no longer liable for criminal deportation.
Japanese import cars are cheap in Australia primarily due to Japan's strict, expensive vehicle inspection system (Shaken) pushing owners to sell younger cars, high quality/low mileage from less driving, Japan's strong car manufacturing leading to lower local prices, and the availability of unique, well-equipped models not sold in Australia, offering great value even after import costs.
Vehicles That Cannot Be Imported to the USA
Non-Conforming Vehicles: Vehicles that do not meet EPA and DOT standards cannot be imported unless they undergo extensive modifications to bring them into compliance. Salvage Vehicles: Salvage title vehicles often face severe restrictions or may be ineligible for importation.
Your $30,000 car payment for 60 months will vary significantly with the interest rate (APR), but expect payments generally between $500 to $650 per month, depending on your credit, dealer, and fees, with lower rates leading to lower payments and less total interest paid over the loan term. For example, at ~6.7% APR, payments might be around $598-$640, while higher rates (e.g., 9-10%) push payments to $640+.
There's no minimum credit score required to get an auto loan. However, a credit score of 661 or above—considered a prime VantageScore® credit score—will generally improve your chances of getting approved with favorable terms. For the FICO® Score Θ , a good credit score is 670 or higher.
It depends on how much income you have after your bills and expenses. As a rule of thumb, your car payment should not exceed 15% of your post-tax monthly pay. For example, if you make the U.S. median annual income of $62,1920 after taxes, you could shop for a car that costs up to $606 per month.
For a $70,000 vehicle, assuming a $10,000 down payment, 5% interest, and 72 months, your payment would be approximately $967 per month.
The average monthly car payment for new cars is $748, while used cars had a slightly lower payment of $532, according to Experian's quarterly State of the Automotive Finance Market report. 43.27% of vehicles financed in the second quarter of 2025 were new vehicles.