How Long Can You Finance a Used Car?

Finance Paperwork with Glasses

We know it’s not possible for everyone to pay for a pre-owned vehicle in full, that’s why we do our best to provide a wide range of financing options to ensure that you can find financing terms that work best for your Holmdel lifestyle and budget. But, how long can you finance a used car? Many drivers often ask us, “How long can I finance a used car?” and the answer truthfully depends on your needs.

However, you’ll find that the average loan term length is around 60 to 72 months. With that being said, different financing institutions near Colts Neck may offer longer or shorter loan term limits. Learn more about loan terms today with the finance experts at Ray Catena Lexus of Freehold and apply for financing with our team when you’re ready to take the next steps in your car-buying journey!

How Long Can I Finance a Used Car? – Short-Term Loans

Now that we’ve answered your question, “How long can I finance a used car?” you may be wondering about different loan term lengths and which option is right for your needs. Short-term loans aren’t right for everyone but they offer some advantages that could make them a good choice. Here are the advantages and disadvantages of short-term auto loans:


  • Lower Interest Rates: Lower interest rates means you’ll be paying less interest over time, saving you money in the long run.
  • Future Financial Freedom: With a shorter loan term, you won’t have to worry about paying for a vehicle for a long amount of time, resulting in more financial freedom in the future.
  • Refinancing Options: It’s typically easier to refinance with a short-term loan because your vehicle hasn’t depreciated much, making it a sound investment for a financial institution to refinance your loan.


  • Increased Monthly Payment: At the end of the day, the numbers speak for themselves and a short-term car loan often results in a higher monthly payment.

How Long Can I Finance a Used Car? – Long-Term Loans

On the flip side of short-term car loans, you can often opt for a long-term car loan as well. Long-term car loans essentially allow you to spread out the monthly payments over a longer period of time. There are advantages and disadvantages to long-term car loans so make sure you do your research. Let’s take a look at the advantages and disadvantages of long-term auto loans:


  • Lower Monthly Payment: Since the loan amount is spread out over a longer period of time, you can often enjoy lower monthly car payments with a long-term car loan.


  • More Interest Over Time: When you compare a long-term and short-term car loan with the same interest rate, you’ll find that you’ll eventually be paying more over time with a long-term car loan because of the accrued interest.
  • Negative Equity: Vehicles depreciate over time and the longer you own a car, the more likely you are to experience depreciation. That means there’s a higher chance you’ll experience negative equity because your vehicle has depreciated lower than the amount of money you owe on your auto loan.

Start the Financing Process Today with Ray Catena Lexus of Freehold!

There’s no right or wrong choice when it comes to short and long-term auto loans but if you need help deciding which option is right for you, feel free to make the short drive to our Freehold dealership for assistance. Before you know it, our experts at Ray Catena Lexus of Freehold will have you driving around Old Bridge in a vehicle that checks off all of your boxes. When you’re ready to get started, be sure to reach out to our team!


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