How big of a loan can I afford? Has this question ever struck you, if it did, then it indeed is a good thought. Financing a car can become a financial burden if it is not planned out properly. If you plan your financing thoroughly you could save a lot of money which would otherwise be spent on paying interest, fees, etc. You need to think of purchasing a car through financing, only when you have established the fact that your income is going to remain stable for the years to come. Car loans can extend to 5 years and beyond, and you need to make monthly payments for the borrowed loan, all through these years.

If you foresee any upcoming mortgage or student loans, etc you should take these payments also into consideration. If you are struggling to make monthly payments today, then it would be an impossible feat to make the monthly payments six months down the line. You need to take these facts into consideration before you opt for a car loan.