Buying a new car has never been more financially daunting. A 2025 analysis from Edmunds found that a record 19.3% of consumers who financed a new vehicle in the second quarter of 2025 committed to a monthly payment of $1,000 or more. That’s nearly one in five buyers taking on what was once considered an extreme car payment — driven by high interest rates and rising vehicle prices.

While it might be tempting to stretch your budget for the car you want, locking yourself into a high-cost loan can be a painful mistake. Before you sign, here are five common car-buying missteps to avoid.

Buying a car you can’t (or shouldn’t) really afford

There’s a difference between being able to buy something and being able to afford it wisely. With an average new vehicle transaction price of approximately

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