What is Extended Term Auto Loan?

Extended Term Auto Loan

Long term car-financing has become a trend as the car-shoppers buy cars on finance. The monthly payments with no interest and low APR appeal to the buyer and lead to the car-shopping through financing. Car loans are of different types and term of the loan that affects the purchasing power.

The long term allows the buyer to pay lower monthly payments. They typically choose the loan term of 24 to 72 months. The long-term loan increases the interest by 30% on new vehicles. Shorter-term loans with fewer interest rates and higher monthly payments. The higher amount of payments for the vehicles lead to paying more than its negotiated price.

Pros and Cons of Extended Term Auto Loans

Low Monthly Payments

The new car price touching the sky and to level it up requires paying the low monthly payment with lesser terms. The standard 48 to 60-month term duration is quite expensive but comfortable to choose from while buying a car from I-5 Motors.

Extended-term loan of 64 months to 84  months leads to paying lower monthly payments provides the payment relief to buyers. Choose wisely while buying the cars as it can affect your credit score when you fail to pay the monthly payment and in the future acquiring a car loan would involve greater risk. Even the failure in payments can lead to repossession of vehicles and bad credit score for longer durations. Car buying should be related to your affordability and invest in a vehicle that you can’t afford has higher consequences. 

Cons of Extended Term Auto Loan

Longer-term payments

The 84-month loan term is huge and leads to paying for more than five to six years. This leads to holding a vehicle for at least six or seven years before you get ownership of the vehicle.

Higher rates

The customer is more likely to pay higher rates according to the term of the loan. Extended-term car loan goes for a longer period of time and this makes the vehicle outdated. After years of using the same vehicle, you don’t have the ownership and paying a hefty amount for years.

What is a 36-Month Car Loan?

The 36-month term loan is commonly used by the car-shoppers who can afford to pay mid-range interest rates and low monthly payments. This is the idle loan term and one can pay off the car loan faster than anticipated and also adds to your savings without paying higher interest rates.

Pros and Cons of 36-Month Car Loan


Short term car loan doesn’t have hefty interest rates and has lower risks involved and affects the credit score. These short-term loans have reduced interest rates and can be paid off within the set time frame.

Choosing a short-term loan doesn’t increase the debt and can be paid off faster and leads to faster payments.


The higher monthly car payment leaves you with no extra money. Buy the car that fits your budget with the short-term car otherwise there are chances the vehicle will be repossessed by the company. Consider the loan discussed at the dealership with a low APR. Check out the Heritage Nissan financing offer before you buy the vehicle.

Firstly, consider the emergency funds and savings before you agree to pay a heavy interest on the car. The new vehicles tend to depreciate more in comparison to the used cars. Plan your car-buying as it might affect your budget and current situation. The vehicle has expenditures related to service and maintenance that have higher costs and can affect the budget with regular repairs.