Just a few years ago, the average term for auto-loans was 4 – 5 years (48 – 60 months). However, financing for these types of loans has recently changed drastically. There are several factors at play, causing the average customer to look for loans lasting up to 10 years (120 months)!
Longer period financing plans are becoming popular for several reasons. Perhaps the largest cause is the cash-strapped nature of the economy. While many people want a new car, they just don’t have the disposable income to afford a large down payment or high monthly payments. By extending the period of the loan, monthly payments can be much lower. Also, cars are becoming more and more reliable thanks to higher build-standards and it is not unusual for a car to last 10 years or more before needing major repairs. Finally, most dealerships are offering great rates on auto loans, even for these long-term plans. This means that customers can extend their loan and minimize monthly payments without paying much more interest when all is said and done.
What do you think? Would you go for a long-term auto loan or are you the type to pay off your car as quickly as possible? Stop by Cumberland Toyota in Cookeville, TN today and check out our great rates and financing options for new vehicles.