Open navigation Main Menu Mortgages
Financing your home purchase or refinancing your current loan Finding the right lender Additional Information
Looking for a financial advisor? Do our 3-minute quiz and then match up the advisor you want today.
Main Menu Banking
Calculators to compare accounts Use the calculators and get advice Bank reviews
Looking for a financial advisor? Do our 3-minute quiz and then match up with an advisor today.
Main Menu Credit cards
Compare according to category Compare with credit requirements Compare by issuer Get advice
Are you looking for the ideal credit card? You can narrow your search using CardMatch(tm)
Main Menu Loans
Personal Auto Loans, Loans for Students, and Loans to Autos Loan calculators
Find the perfect personal loan within 2 minutes or less. You can also answer a few questions to receive offers with no impact on the credit rating.
Main Menu Investing
Best of Brokerages and robo-advisors . Learn the basics Additional information
Looking for a financial advisor? Try our three minute test and then match up the advisor you want today.
Main Menu Home equity
Find the most competitive rates Lender reviews Use calculators Knowledge base
Looking for a financial advisor? Do our 3-minute quiz and connect to an adviser today.
Main Menu Real estate
Selling a home Buying a home Finding the right agent sources
Looking for a financial advisor? Try our three minute test and then match up with an advisor today.
Main Menu Insurance
Car Insurance Homeowners insurance Other Insurance Company reviews
Looking for a financial advisor? Try our three minute test and match to an adviser today.
Main Menu Retirement
Retirement accounts and retirement plans Learn the basics Retirement calculators Additional Resources
Looking for a financial advisor? Take our 3 minute quiz and connect to an adviser today.
Search open Close search
Submit
How long should the duration of your vehicle loan be? Advertiser Disclosure Advertiser Disclosure We are an independent, advertising-supported comparison service. Our goal is to help you make smarter financial decisions by providing you with interactive tools and financial calculators that provide objective and original content. This allows you to conduct your own research and compare data for free and help you make informed financial decisions. Bankrate has agreements with issuers, including but not restricted to, American Express, Bank of America, Capital One, Chase, Citi and Discover. How We Earn money The products that are advertised on this site come from companies who pay us. This compensation could affect how and where products appear on this website, for example for instance, the order in which they may appear in the listing categories, except where prohibited by law. Our loans, mortgages,, and other products for home loans. However, this compensation will not influence the information we provide, or the reviews appear on this website. We do not cover the vast array of companies or financial deals that may be open to you.
SHARE:
FG Trade/Getty Images
4 min read Published August 19, 2022
Expert verified. How is this page certified by an expert?
At Bankrate, we ensure the accuracy of our content seriously. “Expert verified” means that the Bankrate Financial Review Board thoroughly evaluated the article for accuracy and clarity. This Review Board comprises a panel of experts in finance whose goal is to ensure that our content is always neutral and fair. The reviewers ensure that we are publishing high-quality and trustworthy content.
Written by Bankrate Written by
This article was generated with the help of automation technology, and then verified and edited by an editor on our editorial staff.
Editor: Rhys Subitch Edited by Auto loans editor
Rhys has been writing and editing for Bankrate since the end of 2021. They are dedicated to helping readers gain confidence to control their finances through providing clear, well-researched information that breaks down otherwise complex subjects into digestible pieces.
Reviewed by Mark Kantrowtiz Reviewed by Nationally known expert on student financial aid
Mark Kantrowitz is an expert on student financial aid including the FAFSA and 529 plans, scholarships, education tax benefits and student loans.
The promise of the Bankrate promise
More information
At Bankrate we aim to help you make better financial decisions. We adhere to the highest standards of ethical standards ,
this post may contain some references to products offered by our partners. Here’s how we earn money .
The promise of the Bankrate promise
Founded in 1976, Bankrate has a long track history of helping people make wise financial choices.
We’ve maintained this reputation for over four decades by demystifying the financial decision-making
process and giving people confidence in which actions to take next. Bankrate has a very strict ,
so you can trust you can trust us to put your needs first. All of our content was written by and edited by ,
They ensure that what we write ensures that everything we publish is accurate, objective and reliable. We have a team of loans reporters and editors concentrate on the areas that consumers are concerned about most — the various types of loans available as well as the best rates, the top lenders, how to pay off debt and more — so you’re able to be confident about investing your money.
Integrity of the editorial process
Bankrate follows a strict and rigorous policy, so you can rest assured that we’ll put your needs first. Our award-winning editors and reporters produce honest and reliable content to help you make the right financial decisions. Our main principles are that we value your trust. Our goal is to provide our readers with accurate and unbiased information. We have standards for editorial content in place to ensure this happens. Our reporters and editors thoroughly fact-check editorial content to ensure that what you read is correct. We maintain a firewall between advertisers as well as our editorial staff. Our editorial team does not receive direct compensation through our sponsors. Editorial Independence Bankrate’s editorial team writes on behalf of YOU the reader. Our aim is to provide you the most accurate advice to help you make smart personal financial decisions. We adhere to strict guidelines to ensure that our editorial content is not affected by advertisements. Our editorial team is not paid any compensation directly from advertisers and our content is checked for accuracy to ensure its truthfulness. If you’re reading an article or review, you can be sure that you’re getting credible and reliable information.
How do we earn money?
You have money questions. Bankrate has answers. Our experts have helped you understand your finances for over four years. We strive to continuously provide consumers with the expert guidance and the tools necessary to succeed throughout life’s financial journey. Bankrate adheres to a strict code of conduct policy, which means you can be confident that our information is trustworthy and reliable. Our award-winning editors and journalists produce honest and reliable content to help you make the best financial decisions. The content created by our editorial team is objective, factual, and not influenced by our advertisers. We’re honest about the ways we’re in a position to provide quality information, competitive rates and useful tools for our customers by explaining how we earn our money. Bankrate.com is an independent, advertising-supported publisher and comparison service. We are compensated in exchange for placement of sponsored products or services, or by you clicking on specific links on our website. This compensation could affect the way, location and when the products are listed within categories, except where prohibited by law for our mortgage, home equity and other home lending products. Other factors, such as our own website rules and whether or not a product is available within the area you reside in or is within your self-selected credit score range may also influence the manner in which products are featured on this site. While we strive to provide an array of offers, Bankrate does not include information about every credit or financial product or service.
The length of your vehicle financing is the most important thing to consider in deciding on the ideal auto loan. A longer loan period will reduce the monthly installment however you’ll end up paying more interest over the life of the loan. A shorter loan period means that you’ll be paying less interest overall but your monthly payments will be higher. How to determine the right term length When selecting your car loan take into consideration the length of the loan term in relation to the cost of the vehicle and your financial situation. A longer loan term will lower the amount of your monthly payments, but it might not be the best solution when you are able to pay for a larger loan amount or are willing to pay for purchasing a car that is less costly. Bankrate’s advice: It’s essential to look at your budget and both the transaction as well as the maintenance — prior to purchasing an automobile. Get for an auto loan with your bank or credit union before you shop for a vehicle. To determine the best time frame for your loan take these steps: Determine your budget. This should be your monthly budget, and the amount you wish to put aside for the vehicle itself. Consider how your finances will change, and consider that. Be sure to qualify with at least three lenders. Shopping around can help you qualify for the lowest interest rate. A partnership with your local credit union could afford you lower payments, particularly if you have an existing relationship with them. Check the total amount of amount of interest. Take your prequalification results and then plug them into the calculator to determine the amount you’ll be paying each month, and the amount of interest you’d be paying overall. Make a decision. Take into consideration both the monthly installment and the overall cost when deciding which loan timeframe is most suitable for your needs. Short-term and long-term auto loans Although a longer loan gives you the chance to buy a more expensive car, it will also mean more interest over a longer period. Even while the monthly payments will be less, the overall cost will be more expensive. An auto loan, on the other hand, offers less interest paid, but a higher cost per month. If your budget isn’t spot on, or there’s a sudden shift in your income, you may end up struggling with those payment. There’s no ideal loan length for each driver, take into consideration the advantages and disadvantages of each prior to signing off on your next vehicle. Benefits and drawbacks of a long-term automobile loan A is an excellent option if your budget isn’t able to pay for a greater monthly installment. Since your monthly payment will be lower, it might also allow you to pay for a higher-priced vehicle. However, with a longer auto loan you’ll pay more in interest over the course of. A longer-term loan also increases the risk of being caught in the middle of your loan or paying more than what the car is worth. This could make selling or trading in the vehicle more difficult. The advantages and disadvantages of a short-term auto loan Where longer-term auto loans can result in an excessive amount of interest, a shorter term means less interest paid overall. This also means that the car will be yours even faster. In addition, the newer models are sold at a fast rate in the initial five years, which means it’s unlikely that you’ll end up owing more than what your vehicle is worth over an extended time. If your budget is in a pinch and you’re not sure if you can afford the short-term loan is a more risky option. This is particularly true if you don’t have a substantial . To prevent this from happening, stay away from expensive cars that may strain your budget. There are many reasons to think about a less loan term There are several reasons to sign off on the shorter loan. It will allow you to pay off your loan faster, which means that you’ll be able to take advantage of the vehicle you’ve bought and will not be left with the burden of a huge loan due to. Be aware of these important factors when deciding the length of the loan. Lower payments over time A longer loan period could mean payments for five to seven years. A shorter, two- to four-year loan will put you in the full ownership of your vehicle much earlier that means you’ll be able to get the money back in your budget each month and use it to pay down more expensive debts or save. You’re less likely to be upside-down in your loan If you’re looking to change or sell your car, you will have the flexibility to make the necessary changes. You likely won’t have more than what your car is worth, making it easier to swap out to get an alternative vehicle. Better resale value Similar to having a less chance of becoming over-paying on your loan, getting your car paid off earlier means it will be worth more once you’ve finished paying it off. This means that if your circumstance alters and you’re forced to upgrade -or just want something fresh — you’ll receive more than if you had to wait for five to seven years. The bottom line It’s important to consider the amount of car you can actually afford. Beyond the total price of the loan take into consideration how much you can put into your car every month — including gas and insurance. A shorter-term loan may not always be an choice for the automobile of your dreams. But if a similar model is more affordable and will stop you from getting an extended-term loan and it is worth the compromise. If you decide to go with a longer or shorter term, be sure to to obtain the best price possible. Learn more
SHARE:
Written by
The article was created with the help of automation technology, and then verified and edited by an editor from our editorial team.
Editor: Rhys Subitch Edited by Auto loans editor
Rhys has been writing and editing for Bankrate from late 2021. They are committed to helping readers gain confidence to control their finances by providing clear, well-researched information that breaks down otherwise complex topics into manageable bites.
Auto loans editor
Reviewed by Mark Kantrowtziz Reviewed by Nationally recognized student financial aid expert
Mark Kantrowitz is an expert on student financial aid, the FAFSA as well as scholarships, 529 plans educational tax benefits, student loans.
Nationally acknowledged expert in student financial aid
Similar Articles: Auto Loans 6 min read Mar 02, 2023.
Auto Loans read in 4 minutes 30 Jan 2023
Auto Loans 5 min read Dec 23 2022
Auto Loans 3min read Aug 10 2022
About
Help
Legal Cookie settings Do not share my information with anyone else.
How we make money Bankrate.com is an independent, advertising-supported publisher and comparison service. We are compensated for the placement of sponsored products and, services, or when you click on specific links on our site. Therefore, this compensation may affect the way, location and when products appear in listing categories, except where prohibited by law for our mortgage, home equity and other home lending products. Other factors, like our own website rules and whether the product is available in your region or within your own personal credit score could also affect the manner in which products appear on this site. We strive to offer the most diverse selection of products, Bankrate does not include details about each financial or credit item or service. Bankrate, LLC NMLS ID# 1427381 | BR Tech Services, Inc. NMLS ID #1743443 |
|
(c) 2023 Bankrate, LLC. The Red Ventures company. All Rights Reserved.
In the event you loved this post and you would like to receive more information with regards to best online same day payday loans, creditadfwt.ru, assure visit our own page.
Financing a home purchase refinancing your current loan Finding the right lender Additional Information