Is a 72-month car loan worth it? Because of the high interest rates and risk of going upside down, most experts agree that a 72-month loan isn’t an ideal choice. Experts recommend that borrowers take out a shorter loan. And for an optimal interest rate, a loan term fewer than 60 months is a better way to go.
Is it smart to finance a car for 6 years?
There’s really only one benefit of a long-term auto loan that spans six to seven years or even longer. The longer the car loan, the smaller the monthly payment. By taking out financing with an extended loan term, you can potentially buy a more expensive car and still stay within your monthly budget.
Why should you not finance a car for more than 4 years?
You’ll Pay More Interest
Long-term car loans typically carry higher interest rates than shorter-term loans. And even if you can find a long-term loan with a low interest rate, making payments for seven or eight years will likely add up to more interest over time compared with a shorter-term loan.
Should I finance a car for 7 years?
An 84-month auto loan can mean lower monthly payments than you’d get with a shorter-term loan. But having as long as seven years to pay off your car isn’t necessarily a good idea. You can find a number of lenders that offer auto loans over an 84-month period — and some for even longer.
Is it smart to do a 72 month car loan? – Related Questions
How long does it take to pay off a $30000 car?
With a loan amount of $30,000, an interest rate of 8%, and a loan repayment period of 60-months, your monthly payment is around $700. Before you purchase your new vehicle, remember to budget for car maintenance, gas, and car insurance.
What is considered a high car payment?
According to experts, a car payment is too high if the car payment is more than 30% of your total income. Remember, the car payment isn’t your only car expense! Make sure to consider fuel and maintenance expenses. Make sure your car payment does not exceed 15%-20% of your total income.
Can you get a 8 year car loan?
One of the longest car loan terms available is generally a 96-month car loan — except not every lender will offer them, and specialty lenders may have other, longer terms available. If you’re in the market for a low monthly payment, an eight-year-long car loan can provide this; although you may want to compare lenders.
How long can you finance a 7 year old car?
Remember, there’s no set limit on the number of years for a used car loan, and in recent years terms have risen as high as 84 months.
Is 2.9% APR good for a car?
If you’re buying a new car at an interest rate of 2.9% APR, you may be getting a bad deal. However, whether or not this is the best rate possible will depend on factors like market conditions, your credit background, and what type of manufacturer car incentives there are at a given point in time on the car you want.
Can you finance a car for 10 years?
Get Car Financing
Some lenders and credit unions, however, offer extended loan terms of anywhere from 96 months (eight years) to 120 months (10 years). Although the lower monthly payment may seem attractive, a decade-long auto loan could leave you paying for a vehicle that’s worth very little 10 years from now.
What APR is too high for a car?
A high APR (“annual percentage rate”) car loan is one that charges higher-than-average interest rates. The legal limit for car loans is around 16% APR, but you will find lenders that get away with charging rates of 25% or more.
What is a good interest rate for a 72-month car loan?
The average 72-month auto loan rate is almost 0.3% higher than the typical 36-month loan’s interest rate for new cars.
Loans under 60 months have lower interest rates for new cars.
| Loan term |
Average interest rate |
| 60-month used car loan |
4.17% APR |
| 72-month used car loan |
4.07% APR |
What is the best option to finance a car?
Auto Loan Providers With the Best Rates
| Lender |
Starting APR |
Award |
| 1. myAutoloan |
3.99% |
Best Low-rate Option |
| 2. Consumer Credit Union
|
4.69% |
Most Flexible Terms |
| 3. AutoPay |
2.99% |
Most Well-rounded |
| 4. PenFed Credit Union |
4.44% |
Most Cohesive Process |
1 more row
What is the smartest way to finance a car?
How to Finance a Car the Smart Way
- Check Your Credit Score Before You Go to the Dealership.
- If Your Credit Score Isn’t Perfect, Get Financing Quotes Before You Go.
- Keep the Term as Short as You Can Afford.
- Put 20% Down.
- Pay for Sales Tax, Fees, and “Extras” with Cash.
- Don’t Fall for the Gap Insurance Speech.
What should you not say to a car salesman?
5 Things to Never Tell a Car Salesman If You Want the Best Deal
- ‘I love this car. ‘
- ‘I’m a doctor at University Hospital. ‘
- ‘I’m looking for monthly payments of no more than $300. ‘
- ‘How much will I get for my trade-in? ‘
- ‘I’ll be paying with cash,’ or ‘I’ve already secured financing. ‘
Is it better to finance through dealer or bank?
The primary benefit of going directly to your bank or credit union is that you will likely receive lower interest rates. Dealers tend to have higher interest rates, so financing through a bank or credit union can offer much more competitive rates.
How do you negotiate an overpriced car?
Let’s dive into some car negotiating tips that will help you drive home grinning from ear to ear.
- Do Your Research.
- Find Several Options to Choose From.
- Don’t Shop in a Hurry.
- Use Your “Walk-Away Power”
- Understand the Power of Cash.
- Don’t Say Too Much.
- Ask the Seller to Sweeten the Deal.
- Don’t Forget Car Insurance Costs.
What should I spend on a car?
Calculate your take-home income. This is how much you earn after taxes. In general, experts recommend spending 10%–15% of your income on transportation, including car payment, insurance, and fuel. For example, if your take-home pay is $4,000 per month, then you should spend $400 to $600 on transportation.