September 11, 2006 10:36 AM
Car Loans Getting Longer and Longer
It is just astonishing that over a half of new cars are financed with a loan over five years. Probably we should face the reality: if you cannot afford a car, extending the length of your loan will not help (and it will only drag you to a rathole in the long run).
From Bankrate:
Think that car payment would be a little more affordable if you could just spread those payments over another year or two?
If you do, you're not alone. Eighty-nine percent of new car buyers are financing their vehicles for more than four years, and 55 percent select loans that extend more than five years, according to a 2006 study commissioned by the Consumer Bankers Association and conducted by BenchMark Consulting International.
...
With used cars, 82 percent of buyers finance for more than four years, and 40 percent opt for payments to run more than five years, according to the study.
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