How Long Can You Finance a Used Car?

The average loan has grown over the years to become as long as 60 to 72 months as conditions in the market continue to change. Longer loan terms translate to higher total interest costs, but how long can you finance a used car if you need to push your monthly payments as low as possible?

Although there isn’t a hard legal limit, most lenders will not offer loan terms of more than 84 months or seven years. Moreover, some lenders will not offer financing for vehicles with more than 100,000 miles or those that are more than seven years old. Find out how Yellowstone Toyota is here to work with Powell-area drivers from all walks of life to get you the perfect financing plan. Continue reading to learn more about how long you can finance a used car, and then apply for financing online.

Long-Term Loans vs. Short-Term Loans

You can probably finance your preferred used car for a period of up to seven years—but should you? Longer and shorter loan terms each have certain advantages over the alternative for Cody drivers. Here’s what you need to know:

Reasons to Choose a Short-Term Loan

• You want to lower your interest costs and pay less for the vehicle when all is said and done.
• You want to pay off your loan quickly and free up your money for other projects.
• You don’t want to risk ending up underwater—where your vehicle is worth less than what you owe.
• You can only afford a vehicle with higher-than-average mileage, and you’re worried about rising repair costs.

Reasons to Choose a Long-Term Loan

• You want your monthly payment to be as low as possible, and you don’t mind paying more in interest.
• You can only afford a newer, safer vehicle with a longer loan term.
• You’re choosing a vehicle with low mileage that will be completely paid off by the time it has lots of wear and tear.
• You don’t plan on reselling your vehicle in the near future.

Choosing the Right Loan Term

How long can you finance a used car without getting yourself into trouble? It’s a good idea to choose vehicles that will be paid off before they reach 150,000 miles—but this is just a general guideline. In the worst-case scenario, you’ll be stuck making payments on a vehicle that no longer runs or requires expensive repairs to stay on the road. That’s why banks sometimes avoid loans that will pay for older vehicles, and it’s why we think it’s a good idea to choose the shortest loan that you can afford to repay.

We’re Here to Answer Your Questions!

If you’re ready to take home a new-to-you used car, at the price that is right for you, then reach out to our team and let us take care of the paperwork! Our used vehicle specials even will help you make it easier than ever to enjoy a used car for less as you cruise around Billings, MT.