Used Car Loan Length: How Long Should You Finance?
Most used car loans in the U.S. run 60 to 72 months, and the average is about 68 months, or roughly five years and eight months. You can usually borrow for shorter or longer, but a longer term lowers your monthly payment while raising the total interest you pay and the time you may owe more than the car is worth. The best term is the shortest one whose payment fits your budget comfortably.
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TL;DR
The average used car loan term is about 68 months, and most borrowers land between 61 and 72 months.
Common terms are 24, 36, 48, 60, 72 and 84 months. Lenders set the limit based on the car’s age, its mileage, the amount financed and your credit.
Longer terms cut the monthly payment but raise total interest and keep you exposed to negative equity for longer.
Compare offers by total cost, not monthly payment alone, and get preapproved before you shop.
Pick the shortest term you can pay without strain, and keep the option to pay extra when your budget allows.
Table of Contents
What is the average used car loan term?
Experian data puts the average used car loan at 67.86 months in 2026. Its figure for the end of 2025 was 67.68 months, which means the average has barely moved. That is just under 5 years and 8 months. If you are wondering how many years 72 months is, the answer is exactly six.
The average hides how lopsided the market has become. In the last quarter of 2025, more than 70% of used car loan terms were 61 months or longer, and almost a third ran past 72 months. Experian’s earlier data showed that the most popular used car terms are 61 to 72 months, followed by 73 to 84 months.
Why so long for a car that is already a few years old? Prices. The Federal Reserve notes that higher new and used vehicle prices are pushing more borrowers into terms of 84 months or longer. Stretching the loan is the easiest way to make a bigger price fit a monthly budget.
The average is a description of what people do, not advice. Many of those borrowers would have paid less overall with a shorter term and a slightly cheaper vehicle.
Which used auto loan terms are available?
Most lenders offer terms in 12-month steps. The Wall Street Journal reports that most U.S. auto loan terms run from 36 to 84 months, with some lenders offering as little as 24 months or as much as 96. For used cars specifically, Experian says repayment terms typically run 36 to 72 months, though 12 to 84 months or longer are possible.
Here is how the common choices translate into years:
Term | Years | Who it usually suits |
|---|---|---|
36 months | 3 | Buyers with a large down payment or a trade-in with equity |
48 months | 4 | Buyers who want a low interest bill and can handle a higher payment |
60 months | 5 | The middle ground for many used car purchases |
72 months | 6 | Buyers who need a lower payment, with care about total cost |
84 months | 7 | Usually newer, pricier vehicles; weigh the cost carefully |
The term you are offered is not only your choice. It depends on the lender, the car and you.
What is the maximum term for a used car loan?
There is no single legal maximum. Experian explains that there is no set maximum loan term for used cars; the limit comes from the loan amount, the vehicle’s age and mileage, your credit score and the lender’s own policy. In practice, 84 months is the ceiling at many lenders, and some go to 96.
The car itself often sets the cap. A lender treats the vehicle as collateral, and older, higher-mileage vehicles tend to depreciate more and cost more to repair, which raises the lender’s loss if the loan goes bad. So an older car gets a shorter term. Experian adds that older, high-mileage vehicles generally come with shorter repayment options, and some lenders may not finance vehicles more than 10 years old.
Lender cutoffs differ a lot. Investopedia’s comparison of major lenders found limits ranging from 9 years and 100,000 miles at the low end to 13 years and 140,000 miles at the high end. One credit union’s public rate page shows the pattern clearly: terms up to 84 months for recent model years under 100,000 miles, and shorter terms of up to 60 months for older vehicles.
The practical takeaway: the same loan request can get a different term at each lender, so check the vehicle’s model year and odometer reading against the lender’s rules before you fall in love with a car. If a vehicle is outside a lender’s standard limits, that is a conversation to have early with the finance team, not at the signing table.
How loan length changes your payment and total cost
The Consumer Financial Protection Bureau states it plainly: longer terms can lower your monthly payment, increase the total interest you pay, and keep you at risk of owing more than the vehicle is worth for longer. The FTC says the same: loans of 72 or 84 months can lower monthly payments but may carry high rates, making the deal more expensive overall.
A worked example makes the trade-off concrete. These figures are our own illustration, not a quote. They assume a $20,000 amount financed at a 9% APR, with no down payment or fees counted separately, and are rounded:
Term | Monthly payment | Total interest | Total paid |
|---|---|---|---|
48 months | about $498 | about $3,890 | about $23,890 |
60 months | about $415 | about $4,910 | about $24,910 |
72 months | about $361 | about $5,960 | about $25,960 |
84 months | about $322 | about $7,020 | about $27,020 |
Going from 48 to 84 months cuts the payment by roughly $176 a month. It also adds about $3,100 in interest. Whether that is worth it depends on what the monthly savings do for you. If they keep you out of a late payment, they may be. If they just let you buy a more expensive car, you are paying extra for the privilege.
Rates also vary with term and credit, so your real numbers will differ. Run your own figures with a loan calculator using the actual APR you are offered.
The negative equity problem
Cars lose value fastest early on. The FTC warns that with longer financing you could end up owing more than the car is worth. Experian notes that longer loans build equity more slowly, so depreciation can outpace your balance.
This matters the day something goes wrong: an accident that totals the car, or a change in life that makes you want to trade it in. If you owe more than the car is worth, the gap has to be covered or rolled into the next loan. Our guide to negative equity in a car trade explains your options if you are already there.
There is a repayment-risk angle too. The Federal Reserve reports some evidence that borrowers with longer-term loans become delinquent at higher rates than those with shorter terms, regardless of credit score. A longer term is not automatically safer just because the payment looks smaller.
Used cars and long terms: an odd pairing
An older car has fewer good years ahead of it than a new one. A 72 or 84-month loan on a used vehicle can outlast the period when the car is trouble-free and under warranty, so you may be making loan payments and paying for repairs at the same time. That is a good reason to favor a shorter term on used vehicles, or to look at a certified pre-owned model with more coverage left.
How to choose the right used car loan length
There is no universal answer, and published advice varies. The CFPB guide notes that some financial advisers recommend keeping auto loans to five years or less. Others suggest even shorter for used cars. Use these steps to find your own number.
Set the payment you can carry in a bad month. Start with your budget, not the dealer’s monthly figure. Include insurance, fuel, registration and maintenance, not only the loan.
Start from the shortest term. Look at the 48-month payment first. If it fits, take it. If it does not, step to 60 months and check again.
Compare total cost. The CFPB advises focusing on the total cost of financing, not just the monthly payment, because a low payment can hide a high overall cost.
Match the term to the car. The older the vehicle and the higher its mileage, the shorter the loan should be, and the more likely the lender will insist on it anyway.
Put money down. A bigger down payment or a trade-in with equity lowers the amount financed, which lets you choose a shorter term without a painful payment. Our comparison of new versus used vehicle costs shows how that plays out.
Check for prepayment penalties. Ask whether you can pay extra toward principal without a fee. A flexible 60-month loan that you pay off in 48 beats a rigid one.
If you carry credit card balances at high rates, it is worth thinking about the whole debt picture before adding a car payment. A look at balance transfer or personal loan options can help you see where your interest dollars are going.
Credit score and term
Your credit affects the rate and the terms you are offered. The Wall Street Journal says borrowers with higher credit scores typically choose shorter terms. A stronger score also tends to bring a lower rate, which makes a short loan cheaper still. If your score is on the edge, our piece on whether to apply now or raise your credit score first can save you real money. If you are borrowing for the first time, the first-time buyer car loan guide covers the basics, and if a co-signer is part of the plan, read about what to decide before you cosign.
Get preapproved before you pick a term
The CFPB guide suggests you may get preapproved before you shop. Preapproval gives you a rate, a maximum amount and a term range to work with, so you shop for a car you can afford and can compare any dealer offer against a real number. Our walkthrough on getting pre-approved for a car loan explains what lenders look at, and the guide to applying for dealer financing shows what happens on the dealership side.
When you compare offers, line them up on the same basis:
APR, not just the interest rate
Term in months
Amount financed, including any add-ons rolled in
Monthly payment
Total of all payments
Any prepayment penalty or fees
Timing can also help. If you are flexible, read about the best time to buy a car to see when dealers are most open to a deal.
Our perspective on used car loan length
We see the same pattern at our finance desk again and again: a shopper arrives focused on one number, the monthly payment, and leaves with a loan they only half understand. We would rather you leave with a plan.
Our approach is simple. We start with what you can comfortably pay, show you the payment at more than one term, and explain what each one costs over time. If a shorter term fits, we will say so. If a longer one is the only way to keep the budget safe, we will walk you through it and talk about how to pay it down early.
For many used car shoppers, a certified pre-owned vehicle is a good way to keep the loan term sensible, because you are financing a car that has been inspected and comes with added coverage. And if you have a vehicle to trade, we can look at it in your deal so the amount you finance is lower from the start.
We are a family-focused dealership, and we want you to come back for service and your next vehicle. That only happens if the first loan treated you fairly.
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Ready to see your options?
If you want to see what different terms look like on a specific vehicle, our team can run the numbers with you. You can start with our new and used vehicle financing page, or go straight to the financing application. If you have a car to trade in, value your trade first so you know how much it can lower the amount you finance.
Browse our used vehicles or certified pre-owned inventory to find something that fits both your budget and your loan plan.
FAQ
How long can you finance a used car?
Most lenders offer used car terms from 36 to 84 months, and some go to 96. The real limit depends on the car’s age and mileage, the amount financed, your credit and the lender’s policy. Older, higher-mileage vehicles usually get shorter terms.
Is a 72-month loan too long for a used car?
It is common, but it is long. Seventy-two months is six years, which can outlast the best years of a used vehicle and leave you owing more than the car is worth for a long time. If you take one, make sure the payment is comfortable and ask whether you can pay extra without a penalty.
What is the best loan length for a used car?
The shortest term whose payment you can carry comfortably, even in a tight month. For many buyers that is 48 to 60 months. The CFPB notes that some advisers recommend five years or less.
Can I get a used car loan for a car with high mileage?
Sometimes, but expect a shorter term and possibly a higher rate. Lenders set their own cutoffs, and published limits vary widely, from around 100,000 miles to 140,000 miles at different lenders. Check the lender’s rules before you commit to a vehicle.
Does a longer loan hurt my credit?
The term itself is not what hurts credit; late or missed payments do. But the Federal Reserve reports some evidence that longer-term borrowers become delinquent more often, so choose a payment you can sustain.
Sources
Federal Reserve Board: Consumer and Community Context, November 2023
The Wall Street Journal: What’s the Average Car Loan Length?
Consumer Financial Protection Bureau: Take control of your auto loan