How Long Can You Finance a Used Car?

If you’re thinking about a pre-owned model near Thibodaux, you might be wondering, “How long can I finance a used car?” The average auto loan term for a pre-owned car is 60 to 72 months. Depending on the price of the vehicle and your budget, you may have more room to extend the loan length or not. In addition to finding out your buying power and what you can afford to pay every month for your new-to-you vehicle, you should learn more about used car financing below.

Financing a Used Car

How long can you finance a used car? There’s no exact length for every used car loan, but some lenders in Paradis may restrict the range. Some banks limit used car loans to seven years and won’t offer loans on a vehicle with more than 100,000 miles. If you want to know your options, be sure to check with the lender you’re considering to ask about restrictions on financing a pre-owned vehicle.

Pros & Cons of Short-Term Loans

Short-Term Auto Loan Pros:

• Faster Pay-Off: Because your monthly payment is higher, you will repay the loan faster.
• Low-Interest Expenses: You’ll likely get a lower interest on a shorter-term car loan.
• Refinancing: If you qualify, you can always refinance your auto loan later if interest rates drop.

Short-Term Auto Loan Cons:

• Higher Monthly Payment: The shorter the auto loan term, the higher your monthly payment will be. You’ll want to make sure you can afford a higher monthly payment and that it won’t break your budget.

Pros & Cons of Long-Term Loans

Long-Term Auto Loan Pros:

• More Affordable Monthly Payment: When you opt for a longer-term auto loan, you’ll pay less every month than if you had a short-term loan. You can always make a higher monthly payment to repay it faster.

Long-Term Loan Cons:

• Higher Interest Rates: Long-term auto loans offer higher interest rates, and the longer the car loan, the more interest you’ll pay overall.
• Vehicle Depreciation: Cars depreciate as they age, but depreciation rates slow down as they age. The longer the loan length, the more risk you have of ending up in a negative equity situation in Hahnville. This situation means your car’s value is less than the balance you owe.

Finance a New-to-You Car With Southland Dodge

We’ve answered the question “How long can you finance a used car?” What’s next? Feel free to learn more about what to look out for when shopping for a pre-owned model. If you’re ready to find your next vehicle in Houma, you can count on our finance specialists to secure a plan that works for you.