How Long Can You Finance a Used Car?

Tiny car with coins and finance paperwork
Conventional wisdom holds that the smartest way to purchase a used car is to buy it outright. However, since many people in Cerritos don’t have the cash for a new or used vehicle, financing is a necessary and important option. The average loan length for a used vehicle is from 60 to 72 months, though the rising cost of used cars causes some to seek a longer loan term. Ultimately, how long comes down to what kind of monthly payment you can afford.

So how long can you finance a used car in Long Beach? There’s no legally set limit on the length of a used car loan, but lenders often establish their own term limits. Many banks in the Cerritos area won’t go past seven years and 100,000 miles, so it’s important to ask around before committing to a specific loan length. And check your credit standing before asking, “How long can I finance a used car?” Learn more with Lexus of Cerritos!

Short- and Long-Term Loans: Pros and Cons

So, how long can you finance a used car? As mentioned above, most lenders won’t go past 7 years. Now let’s explore the pros and cons of long loans. The longer the loan, the smaller the monthly payments. But there are drawbacks that will cost you in the long run:

Long-Term Loan Cons

  • A nice long loan term may seem to be the best case scenario if money is short, but the longer your loan is, the more it’ll cost you in interest.
  • Depreciation is another complicating factor. It can cause you to fall into a negative equity position, since depreciation causes a used car to lose value over time.

Long-Term Loan Pros:

  • A long-term loan allows you to make monthly payments you can better afford and gives you the option of paying more when you can.

Short-Term Loan Cons:

  • A short-term loan means your payments will be high, often a problem for prospective buyers. Talk to your local lender in Long Beach to ensure you get loan terms that fit within your budget.

Short-Term Loan Pros:

  • A short-term loan costs less in interest rates, as more of your payments go toward the principal.
  • A short-term loan is often attractive to car buyers because it means the loan is paid off sooner.

Reach Out to Lexus of Cerritos for a Financial Consultation

You’ve read our answer to the questions, “How long can I finance a used car?”. If you seek financing for a used car loan in Torrance, work closely with the finance department at Lexus of Cerritos. We’ll make sure your application is accurate and reflects your credit background. Don’t forget to seek top value for your trade-in (check out our trade-in tool). We’re also delighted to help if you’re in the car-buying process, so take a good look at our used car inventory, and contact us today if you’d like to take a test drive.


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