How Long Can You Finance a Used Car?

Signing Finance Documents for Car

On average, the auto loan term is about 60 to 72 months, but Richmond drivers can expect the term length to increase as car prices increase. Still, there is no one set of rules on how long you can finance a used car. It all depends on how much you are able to pay every month and if a longer or shorter loan term suits you better. Learn more below before taking your new-to-you vehicle home.



What is the Maximum Amount of Time to Repay a Car Loan?

Generally, there isn’t really a set limit on how long you can take to repay a car loan. If you are going to a bank though, you should keep in mind that some banks have a policy on used cars that prevents buyers from financing vehicles over seven years old and with over 100,000 miles on their odometers. To see what your options are, you should contact your preferred lender and ask about their restrictions on used car financing before taking the next step.

What Are the Pros & Cons of Short-Term Loans?

Short-Term Loan Pros:

  • Low-Interest Expenses: You’ll pay less interest over time since you’ll have a shorter loan term and a higher monthly payment.
  • Faster Pay-Off: Again, the higher monthly payment will aid you in paying the loan off faster. This is right for you if you can afford to make the higher payments in Winchester.
  • Refinancing: If you choose, you can refinance your loan later down the road (assuming your credit score is strong). Usually, it’s easier to do this with a short-term loan because your car will spend less time being upside down.

Short-Term Loan Cons:

  • Higher Monthly Payment: Short-term auto loans come with a higher monthly payment than long-term auto loans. Rethink if a higher monthly payment suits your budget and your lifestyle.

What Are the Pros & Cons of Long-Term Loans?

Long-Term Loan Pros:

  • More Affordable Monthly Payment: When you choose a longer loan term for your next car in Danville, you’re paying less every month a longer period of time. If your financial situation changes at any point, you’ll have some leeway to work with.

Long-Term Loan Cons:

  • Higher Interest: Long-term loans come with higher interest rates; the longer the loan term, the more interest accrues.
  • Vehicle Depreciation: Cars depreciate over time, but the depreciation ratesslow down as a car gets older. This means the longer the length of the auto loan, the more time your car will spend as “negative equity.” This is when the car’s cash value is less than the balance of the loan.

Finance Your Next Used Car at Short Redmond SuperStore!

Are you thinking about getting a shorter or longer auto loan term in Lexington? Regardless, Short Redmond SuperStore can help! We are a used car dealer, so we know all there is to used car financing and we even have a selection of pre-owned models for you. Applying for financing or contact us today!


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