What Car Can I Afford? Car Price by Salary
The table starts from what lands in your account each month. It sets aside about 20% of that for the car instalment, which is Carfin's cautious guide and not a bank rule, and works out the car price that instalment pays for.
- Instalment
- About 20% of take-home pay
- Deposit
- 10% of the price
- Term
- 72 months
- Example rate
- 11.75% a year
| Take-home a month | Car price, about | Deposit | Instalment a month | Total repaid to the bank |
|---|---|---|---|---|
| R10,000 | R110,000 | R11,000 | R1,923 | R138,429 |
| R15,000 | R170,000 | R17,000 | R2,971 | R213,935 |
| R20,000 | R225,000 | R22,500 | R3,933 | R283,150 |
| R25,000 | R285,000 | R28,500 | R4,981 | R358,657 |
| R30,000 | R340,000 | R34,000 | R5,943 | R427,871 |
| R40,000 | R455,000 | R45,500 | R7,953 | R572,592 |
| R50,000 | R570,000 | R57,000 | R9,963 | R717,313 |
The example rate is prime (10.75%) plus one point, for illustration. Your rate comes from the bank and depends on your profile. Prices are rounded down to the nearest R5,000. Bank fees, insurance and licensing are not included, and no balloon is used. These are examples, not quotes. Check any row in the car finance calculator.
How South African Banks Check What You Can Afford
The National Credit Act requires every bank to check that you can afford a loan before it lends. That check, not a percentage, is what decides your limit. In broad terms the bank:
- Confirms your income from your payslips or bank statements
- Takes off tax and other deductions
- Takes off your living expenses, using at least the minimum amounts the regulations set for your income
- Takes off what you already pay on other debt, such as store cards, personal loans and a home loan
- Checks that what is left covers the new instalment
So two people on the same salary can get very different answers. Someone with no other debt can often afford more than the table shows. Someone with several accounts may be able to afford less. Your credit record then decides the rate, and the rate changes the instalment.
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Costs Beyond the Instalment
The instalment is only part of what a car costs each month. Before you choose a price, add:
- Comprehensive insurance, which the bank requires for as long as the finance runs
- Fuel, at the distance you really drive
- Services and tyres, especially once a service plan ends
- A tracking device, if your insurer asks for one
- The yearly licence disc
Get an insurance quote on the exact car before you sign. A sporty model or a young driver can add a lot to the monthly cost and change what you can comfortably afford.
Ways to Afford More Car
- Put down a bigger deposit. It lowers the amount financed, the instalment and the total interest.
- Pay off small debts first. Every store card or loan you close frees up room in the affordability check.
- Look at a good used car. A newer used car often costs far less than the same model new. Carfin also arranges finance on private sales.
- Compare banks. A lower rate lowers the instalment. Carfin sends one application to the top banks at the same time and a consultant negotiates the offers.
