How long is a typical car loan?

I'm looking to apply for a new car loan. I'm trying to figure out how long of a car loan I should get. I have no idea what’s ideal. I know the longer the term, the higher the risk of ending up underwater. How long is a typical car loan?

Answer
Thinking about the term length and how much you can afford means you’re on the right track. A typical car loan is 72 months, or six years.
Needless to say, that’s a long time!
A 72-month loan term is not recommended by financial experts because of precisely what you mentioned. A car is a quickly depreciating asset, so paying it off slowly can lead to going upside-down (aka underwater) on the loan. That means you owe more on your car than what it is worth.
The good news is if you want to get out of a lengthy car loan or find a loan with a better interest rate, you likely can by refinancing.
Jerry is an app that does all of the work needed to refinance your car for you. Jerry uses your current loan information and credit score to find competitive rates from top lenders. On average, people pay $85 less every month on their car loans after refinancing.
Lauren Smith
Answered on Nov 19, 2021
Lauren has written for World Nomads, the Matador Network, Korvia Consulting, and once upon a time Three Fates Games. She graduated from Columbia College of Chicago with a BFA in Creative Writing. After graduating, she moved overseas and lived in South Korea where she spent her free time traveling and going on road trips with friends. She misses the rest stop potatoes and is trying to figure out how to recreate them at home. She's now based outside of Chicago and when she's not writing she spends her free time reading, playing video games, and exploring whenever she can.
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