The average new-car loan now stretches almost six years, and more borrowers than ever are signing up for terms longer than that. So how long are car loans, and how long should yours actually be? The answer shapes both your monthly payment and how much interest you hand over.
Loan length is one of the few parts of a car deal you can control. Getting it right can save you thousands.
How Long Are Car Loans, Really?
Car loans usually run in 12-month steps, from as short as 24 months to as long as 84 months. The most common options are 36, 48, 60, 72, and increasingly 84 months.
A longer term lowers your monthly payment but raises the total interest you pay. A shorter term does the opposite, costing more each month but far less overall.
Common Car Loan Term Lengths
Here is how the standard terms compare at a glance.
| Term length | Years | Typical use |
|---|---|---|
| 36 months | 3 years | Lowest total interest, higher payment |
| 48 months | 4 years | Balanced choice for many buyers |
| 60 months | 5 years | Very common, moderate payment |
| 72 months | 6 years | Lower payment, more interest |
| 84 months | 7 years | Lowest payment, highest total cost |
Average Car Loan Length in 2026
Americans are borrowing for longer than they used to. As of Q4 2025 data from Experian, the average new-car loan term is 68.9 months and the average used-car loan is 67.7 months.
More than a third of new-vehicle loans now run longer than six years. Borrowers with top-tier credit tend to choose shorter terms, averaging around 64 months, while nonprime borrowers often stretch to about 75 months to lower the payment.
Shorter vs. Longer Terms: The Trade-Off
A shorter loan means bigger monthly payments but less interest and faster equity in your car. You also lower the risk of owing more than the car is worth.
A longer loan makes the monthly payment easier, which is why it is tempting. The catch is more interest over time and a higher chance of going upside down, where you owe more than the car's value.
How Term Length Affects Total Cost
Say you finance $30,000 at 7% APR. On a 48-month loan, you pay about $718 a month and roughly $4,470 in total interest.
Stretch that same loan to 72 months and the payment drops to about $512, which feels nice. But your total interest jumps to around $6,860, nearly $2,400 more for the same car. Longer is easier month to month, but it costs you.
Choosing the Right Term and Shopping Smart
A good rule of thumb is to pick the shortest term whose monthly payment still fits comfortably in your budget. Many experts suggest keeping new-car loans at 60 months or less.
Rates and terms vary widely between lenders, so it pays to compare. Marketplaces like myAutoloan let you request offers from several lenders at once and see how different term lengths change your rate and payment. APRs vary by creditworthiness, and terms and conditions apply.
myAutoloan
myAutoloan
Find the right auto loan in minutes — even with bad credit. myAutoloan connects you with 20+ lenders to compare personalized offers for new cars, used cars, refinancing, and lease buyouts. Free to use with no obligation.
Standout feature
Compare offers from 20+ lenders. Works with bad credit. BBB A+ rated.
Fees
Free
Pros
Free to use with no obligation. Works with all credit types including bad credit. BBB A+ accredited.
Cons
Some users report receiving calls from multiple dealers after applying.
If you are already in a long loan with a high rate, you do not have to ride it out. iLending is an auto refinance service that may help you shorten your term or lower your rate, so more of each payment goes toward the car instead of interest.
iLending
iLending
iLending is an auto refinance service that pairs you with a dedicated loan consultant and shops your loan across a network of 60+ lenders. Clients save an average of $148 per month**, and you may be able to skip payments for 45-90 days while your new loan is set up*. iLending works with credit scores as low as 560 and delivers decisions in as little as 24 hours.
Standout feature
Skip payments for 45–90 days when you refinance*
Fees
Varies by lender
Pros
60+ lender network; accepts credit scores as low as 560; decisions in as little as 24 hours; average savings of $148/month**
Cons
Not available in HI, NH, RI; vehicles must be under 150,000 miles; consultation happens by phone
Your credit score heavily influences both the rate and the terms a lender will offer. Creditship provides tools to help you build and monitor your credit, which may unlock shorter terms at better rates. Buyers in higher credit tiers consistently get the shortest, cheapest loans.
Creditship
Creditship
Get free credit monitoring and concrete advice how to improve your credit from Creditship AI.
Standout feature
AI Credit Coach. AI analyzes your credit report in depth and gives you tailored, actionable steps to raise your score.
Fees
Free
Pros
Free credit report access plus monitoring and alerts
Cons
No credit repair feature
The Bottom Line on Loan Length
Longer car loans are popular because they lower the monthly payment, but they cost more and keep you in debt longer. Whenever the budget allows, a shorter term is the cheaper, safer choice.
Before you sign, compare offers, run the numbers on total interest, not just the monthly payment, and pick the shortest term you can afford.
Frequently Asked Questions
What is the most common car loan length?
Sixty and 72 months are the most popular terms today. However, the average new-car loan has crept up to about 69 months as buyers try to keep payments affordable against higher car prices.
Is a longer car loan ever a good idea?
It can make sense if you need a lower monthly payment to keep your budget balanced, and if the interest rate is low. Just know you will pay more interest overall and risk owing more than the car is worth for longer. Making extra payments can offset some of that cost.
Can I pay off a long car loan early?
Usually yes. Most auto loans use simple interest and have no prepayment penalty, so paying extra shortens the loan and saves interest. Always confirm your specific contract has no early-payoff fee before you start.
Does a longer loan term mean a higher interest rate?
Often, yes. Lenders typically charge slightly higher rates on longer terms because the loan carries more risk over time. That means an 84-month loan can cost you twice over, through both a higher rate and more months of interest.
