texas94z

It's time for a new ride. I'm going to use credit this time. Normally I pay in cash. After I totaled my Camaro last winter, I bought a GTP for a temp replacement. Its a decent DD and it's nothing to complain about, however it time for another V8 rwd car. I'm trying to be a young, responsible GM car enthusiast wanting to buy a legit car this time around. I'm going to buy myself something dank!! I'm having a hard time figuring out what my payment options. So i figured 20% of my monthly income, for a single male, is my max payment option. Is that too much or too little? Keep in mind that I the personality of out doing myself lol.

GTRACER88

For me I did 1/6th if my income. That was also including my insurance. Mind you I'm only 21. Others can spend less.

texas94z

I'm 23. 1/6 including insurance isn't bad and very affordable. I don't wanna turn into one of those idiots that bought a car that they can't afford.

westtexasbuff

iTrader: (40)

1/6 here for me too with full coverage insurance. And I'm 22...

LEO

iTrader: (3)

10% with full coverage but I'm 39.

drago1217

iTrader: (6)

I got rid of my mint ws6 because of payment and bought one cash but then again I have a family of 4 and I pay for everything including my wife's car payment. Its not really a matter of simple ratio. You have to take into account all your bills. Depends on how much extra you have without a car payment right now. If you have a lot of bills or you have champagne taste on beer budget so to speak you will strap yourself with no play or you would have to change your spending habbits.

But if you are not that way and have extra money to play with then an idea I throw out there is buy something used and cash. Save the amount slotted for a car payment in savings and you can buy the same car in almost half the amount of time it would take you to pay it off because you knock out paying interest. In fact if you put the money into a high yield account you can make the interest instead of spending on interest and it would help you reach buying the same car cash faster.

My. 02

danieloneil01

20% what? Net or Gross?

If it's gross you gonna be broke unless you live in a dump.


And never use the word dank, again.

ColeGraham

iTrader: (8)

i am at 1/4 for both my cars (including insurance), 1/4 for my house, and the rest for the bills. and that is from Gross. Net, will make the cars and the house 1/3 and 1/3.

i can affrod it, but i want to get to sell my truck.

1/6 is a great starting place for a note. but dont for get to include average driving cost per month in you budget also.

drago1217

iTrader: (6)

I agree because rule of thumb is try and keep your mortgage/rent at 25% of your bring home pay. On average I bring home 4k a month and my rent is 1k. But all my bills and expences are another 2k or so that only leaves like 250 a week free play. There's no way I would spend another 5 or 600 on another car note/ insurance.

Gotta think is it worth the bind of a high car note

ttranssam

iTrader: (10)

Yea, it depends on how much you make...when I got my car it was like 25/30% but I got tired of paying on the car so now I have been making like 600 dollar payments and cut my loan term to 3 yrs not 6 I only got like 25 hundo to pay!

retardedpenguin

iTrader: (2)

1/4th without a car payment.

Cash only for me, I'd like to finance my next vehicle but still have the exact payout in the bank, so I can build credit yet technically not be in debt..

Phil99vette

iTrader: (11)

Considering I do this for a living....

more than 50% of loans with 17% or higher payment to income will repo in 24-36months
Most banks cap the payment to income at around 15%
A comfortable number is usually between 9 and 12% of your gross before taxable income.

jb7241986

iTrader: (4)

I just got a great job so soon ill be doubling up payments as well

99FRC

iTrader: (5)

This!

$750 L98

iTrader: (7)

I was about to say, I don't know how some of you stretch that far. Bills + rent is 50% of my gross income, using another 20-25% of that would hardly leave room for groceries and gas, not to mention the inevitable "Oh ****" moments, or starting a savings account.

htownws6

iTrader: (1)

I read in a book one time that your house, car, and credit card payments should not be more than 36% of your gross pay, and your car and credit card payments (not including house) should not be more than 20% of your net pay.

drago1217

iTrader: (6)

Look up Dave Ramsey and see what he says about cars

Z0_RICK

8% before insurance. I also have a mortgage that is 20%.

danieloneil01

LOL, and if everyone listened to him on mortgages 99% of people would be renting. And yes I agree with him on that issue to.

So how many people's mortgage is 1/4 NET monthly income on a 15 yr loan (not a 30yr)?

Yeah, not many.

I think a bank would've done you a favor and not approved that. I've done bad things too but vowed to follow the right path. Not saying you're going to fault the loan but have you seen what you're paying if you go the full 6 years on a car that's 8yrs old now?


But liking fast cars and buying mods is not helping. lol

retardedpenguin

iTrader: (2)

You do understand that you are paying $25,000 for an 02 SS, right? I really hope you typed that in wrong.