The 97 Month Car Loan

97 month car loan

Lenders rolled out an extra-long-term car loan last week: The 97 month loan. (That’s eight years, folks.) The lenders claim that this is because the average price of a new car has risen to $31,000 and extra-long loans are the only way that some buyers can get an affordable monthly payment. I’ve seen several reactions to this news this week, ranging from surprise to glee. But the reaction that surprised me the most was the feeling amongst some that this was a “necessary” maneuver.

The argument goes like this: Some people just need a break. They need to have a lower car payment so they can buy groceries, keep the electricity on, or be able to afford reliable transport

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6 Responses to The 97 Month Car Loan

  1. Mary Alice says:

    For pete’s sake!

    Yeah, buy a used car. My brother is staring this down, if he can he’s going to go for a 5-6 thousand dollar used car and possibly get a loan for that if he gets the job he’s also staring at. I think that’s a better move!

  2. Debbie M says:

    It’s true the payment on an eight-year loan is lower than on, say, a five-year loan, but only for the first five years. For the last three years, it is a LOT higher. People also deserve a break during those years.

    For people who always keep a car until it’s paid off and then immediately get a new one, this might work out better for them (if they get a model that they can afford to maintain for eight years). They will pay more per car, but have fewer cars.

    But I agree: mostly it’s just scary. I prefer to buy very used cars in reliable models for cash.

  3. fern says:

    I like to buy my cars new and then own them forever. Like the 99 Civic I’m currently driving. I might add that with a sub-compact, buying new last time meant paying $13,000, much lower than $30K. I have paid cash for my past 3 new cars to avoid interest, but there seem to be a lot of 0% loans out there so I would go for one of those if it meant delaying payment for a time, and then I’d pay in full before the 0% offer expired.

  4. teresa says:

    What I want to know is why the average price of a car is now so expensive that an eight year loan is needed so people can afford to “live”. Wages sure haven’t raised enough to justify a society paying that much for a box with wheels. I would never purchase a new vehicle because you loose value immediately and then to pay interest on top of that is crazy!

  5. eugene says:

    It would be nice if I could afford a car at all. I would be more than willing to pay over 100 months if I could get one that was reliable and that I could actually afford.

  6. sarahsmile90 says:

    If you need these terms to afford the monthly payments, then you most likely can not afford the car. Do the math and figure out what you will actually be paying for the car and you may think twice.

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