How much car can you actually afford based on your income and budget?
The most widely recommended guideline is the 20/4/10 rule: put at least 20% down, finance for no more than 4 years (48 months), and keep total transportation costs (payment + insurance + gas + maintenance) under 10% of your gross monthly income.
A 20% down payment prevents you from going "upside down" (owing more than the car is worth) since new cars depreciate about 20% in the first year. A 4-year maximum term limits total interest and ensures you build equity faster than the car depreciates. The 10% income cap ensures transportation costs do not crowd out savings, housing, and other priorities.
Focusing on the monthly payment instead of total cost. A $400/month payment sounds affordable, but over 72 months at 8%, you pay $28,800 for a $22,000 car. Ignoring insurance costs (a new BMW costs 3-4x more to insure than a Honda Civic). Not accounting for maintenance ($500-1,000/year for most cars, $2,000+ for luxury brands). Stretching to a 72 or 84-month loan just to afford a more expensive car.