How Long Can You Finance a Used Car?

2020 Acura MDX

Have you ever wondered about how long you can finance a used car? The average auto loan around Anaheim is about 60 to 72 months, but it’s expected to keep increasing as car prices continue to increase. Your auto loan length will depend on what you can afford to pay per month. Keep reading to learn more about used car finance. If you have questions, reach out to our friendly finance team near Costa Mesa, and ask about the Acura finance deals at Weir Canyon Acura.

Maximum Amount of Time to Repay a Car Loan

There isn’t a limit on the maximum amount of time you can take to repay an auto loan. However, banks follow standard guidelines. Some banks have a policy on used cars that prevents Tustin buyers from financing cars that are over seven years old and with more than 100,000 miles. It’s best to contact your preferred lender and ask about their restrictions on used car financing before you get started. You can get more information about Acura finance rates and loan length from our finance specialists. 

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

Short-Term Loan Pros:

  • Lower Interest Expense: You’ll pay less interest over time with a short-term loan.
  • Faster Pay-Off: You’ll pay off the car faster which means you’ll gain equity quicker.
  • Refinancing: If you want, you can refinance your auto loan later (assuming your credit score meets the requirements). Generally, it’s easier to refinance with a short-term loan, because you’ll have equity faster and spend less time upside down in your loan. 

Short-Term Loan Cons: 

  • Higher Monthly Payment: Short-term car loans come with a higher monthly payment than long-term loans. Be sure a higher monthly payment works for your budget, and won’t have a negative impact on your financial freedom. 

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

Long-Term Loan Pros: 

  • More Affordable Monthly Payment: With a long-term loan, like some Acura finance offers, you’ll pay less every month over a longer period of time. It gives you some flexibility if your financial situation changes.

Long-Term Loan Cons: 

  • Higher Interest: Long-term loans mean you’ll pay higher interest rates. The longer the loan term, the more interest you’ll pay.
  • Depreciation: Cars depreciate as they age, although depreciation rates do slow down as time goes on. Still, the longer the length of the car loan, the more time your car will be in a “negative equity” position. Negative equity is when the car’s value is less than the remaining balance of the loan. 

Finance Your Next Used Car at Weir Canyon Acura! 

Now that you know more about used car finance, are you ready to take the next steps and finance a new-to-you vehicle? We invite you to explore our Acura finance rates and go for a test drive around Montclair. Our team will explain our Acura financing offers and help you get a payment you can afford. You can start the process by completing an online credit application. Reach out to us today and let us know how we can help. 

 

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