If you’re considering enhancing your daily commute with a pre-owned vehicle, you might be pondering things like, “How long can I finance a used car?” There are numerous car-buying solutions available for drivers who want to be mindful of their budget. It is common for a pre-owned vehicle to have an auto loan term of 60 to 72 months, allowing for smaller monthly payments through longer lease terms. However, the duration of your auto loan is determined by your monthly payment capability. Using our payment calculator to assist in estimating your monthly payments can help gain further insight into the question, “How long can I finance a used car?” Afterward, you can take a look at our pre-owned selection at Don Hattan Dealerships.
Restrictions on Financing a Used Car
How long can you finance a used car without restrictions in Wichita? How long you can finance a used car ultimately depends on the lenders. While there’s no set limit on term length, lenders tend to place their own restrictions on auto loan length. In some instances, banks limit auto loans to up to seven years and generally prevent loans on vehicles with more than 100,000 miles. Be sure to ask about restrictions on financing a used car and consider if the loan terms work for your needs.
Pros and Cons of Short-Term and Long-Term Loans
How long can you finance a used car? Ultimately, the decision is up to you. When making decisions about loan terms for your used vehicle loan, there is no definitive answer. Determining the appropriate duration for financing a used car relies on your current budgetary constraints and your ability to manage payments throughout the term. Let’s take a look at the advantages and disadvantages of each term length.
Pros and Cons of Short-Term Loans
Pros of Short-Term Loans
- Faster Pay-Off: How long can you finance a car if you want to pay your loan quickly? If you’re looking to satisfy your loan faster, short-term loans with a higher monthly payment allow you to repay the loan faster.
- Low-Interest Expenses: Lower interest rates are available with shorter-term loans.
- Refinancing: How long can you finance a used car before you refinance? It depends on how much equity you’ve paid. You may qualify for an interest rate drop with a refinanced auto loan.
Cons of Short-Term Loans
Higher Monthly Payment: Be sure you can handle higher monthly payments. Consider your monthly expenses to make sure you can afford full and timely car payments.
Pros and Cons of Long-Term Loans
Pros of Long-Term Loan
More Affordable Monthly Payment: Long-term payments give you more wiggle room in your budget. You pay less every month than if you had a short-term loan, and you still have the option for higher payments to repay the loan faster.
Cons of Long-Term Loan
- Higher Interest Rates: The longer you have the auto loan, the more interest you’ll pay overall.
- Vehicle Depreciation: All vehicles depreciate once they leave the lot. While depreciation slows down as the vehicle ages, longer-term lengths also bring the risk of negative equity. Negative equity is when the value of the vehicle is less than the balance you owe.
Take Home a Luxury Pre-Owned Vehicle with Don Hattan Dealerships!
If you’re still curious about how long you can finance a used car, our finance department can help. Next time you’re on your way home to Derby or Andover, stop by our Wichita location and a member of our team can help. Otherwise, use our secure online portal for quick pre-approval.