![]() The two types of car loans are short and long term. Long Car Loan TermsĬonsider several factors before financing a used car, including the number of months over which you plan to repay the loan. The only way to know how long you can finance a used car is to read your lender's used car guidelines, or speak to a representative. Similarly, you might not be able to finance a car with 150,000 miles for more than three years. However, lenders and banks typically follow common guidelines, especially as it relates to age and mileage.įor example, you usually can't finance a used car older than 10 years with a five year loan. There's no universal maximum loan term for a used car. Is There a Limit to How Long You Can Finance a Used Car? But as used cars gained popularity, it prompted lenders to began offering loans of 84 months and even longer, to meet consumer demand. Historically, used car loans had 72-month limits. You might find that some lenders cap loan terms at 84 months, while others will give you a loan for up to 96 months. Compare auto loan rates here How Many Years Can You Finance Your Used Car?Įvery lender has different rules around how long you can finance a used car. If you’re wondering how long you can finance a used car, here’s what you need to know. Even with the most generous lenders, there’s usually a maximum loan term you can choose. Lenders typically provide loans that range from 36 to 72 months, but longer and shorter loan terms are available. ![]() You pay the money back over a fixed period of time and pay interest on the amount you borrowed. An auto loan allows you to purchase a car without paying the entire cost upfront. What good is a low payment if it takes you 84 months to pay off the loan? Is the selling price for the car a good deal? What about the trade-in amount the dealership is offering for your car? Ask for the "out-the-door" figures from your salesperson and review them before making a decision.If you’re in the market for a used car, you might be thinking about getting a loan. When you obtain a monthly payment, be it from a price quote, negotiation or advertised special, make sure you are aware of all the numbers behind it. Furthermore, these figures will differ for those who lease, so take a look at our articles for information specific to that scenario. Keep in mind that everyone's situation will be different, so these recommendations are not set in stone. The loan term should ideally be less than 72 months, and you should aim for a down payment of at least 10% or consider GAP insurance. Your loan payment should be no more than 15% of your take-home pay. The general rule for each of these is as follows: It is also important to be aware of how much the loan will total, how much of a down payment you're making, and how long the loan will be. ![]() And though this figure is the easiest to understand, it isn't the only number to be aware of. ![]() It can give you a reality check on whether you can afford the vehicle. The monthly payment is the best indicator of how the car loan will impact your budget. ![]()
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