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Looking for the average length of a car loan and the typical car loan length in this and car loan generally on average, then this article will answers’ your questions.  In case you happen to be amongst 80 percent intended new car owners planning to get a car loan, or you’re among the categories of people who buy old cars, which over half wants a car loan to get their transaction completed. No matter the side you fall in, our info here will inform you all you need to know on interest rate, repayment plans and the answer on what is the average length of a car loan in U.S. And after going through it, you will be ready to decide on what you want and get a smarter bargain.

You should know that car loan rate are at a lower level now because of the lower interest rate in our society. For 10 year now, the car loan interest rate for 48 months plan from banks keeps falling to over 48 percent. Though it’s because of the financial down fall of 2009 which caused interest rates to fall to make people to spend on things such as cars instead of them to save money.

Average Length of a Car Loan (average car loan length)

Car loan via automobile financial firms has the history of a lowering their rates than banks. Most of the car production firms now have their own financial subsidiary that gives out loan to individuals buying car from the firm. With this innovation, automobile makers can now offer a low interest rate which becomes a good way to earn additional income for the firm.

Around august 2018, every month car loan repayment for individuals was about $531. This happened due to lots of persons who prefer expensive SUVs and for them knowing that they will have to pay a higher repayments every month, they decided to get a long car loan plan.

There are information showing that 62% of auto loan in 2014 was beyond 5 years of repayment plan.

For those going for used vehicles, the average plan was 6 years which was around 2018. Although many are financing less of used vehicles than new ones, which they take almost the same period to repay the loan offered.


Averagely in U.S, the interest for car loans is about 4. 21 percent for a 5 years loan. But for those who want a personal car loan, the rate which will be given will be due to credit score, loan length and other things the loan giver will have to check before giving the loan. But basically, the average car loan in U.S is about 3 to 10 percent.

  • Car Loan Rate (by Credit Score)

For individuals that has a higher credit scores of 750 and beyond are seen to be prime loan applicant which will pay about 2 to 3 percent rate and for people that has less score are seen by lender as a risky investment and will have to repay a high rate. For score that is less than 580 will be seen as individuals with poor finance history, this can be sometimes caused by late repayments, default in payment, etc. The people in such categories ends up repaying a car loan of about 5 to 10 times higher.

For people with good credit scores usually repay a rate less than the 4.21 percent in the 5 years plan and people with bad score are to pay high rate.

  • Car Loan Rate (By Length)

Commercial bank and others offer repayment plan that range from 2 years to 6 years, which the lower the loan plan, the lower the interest rate. Although the normal car loan plan is 5 years, but currently, we have seen people going for 6 to 7 year plans. Here are average car loan rate and length:

  • 36 months length goes with interest rate of 3.71 percent
  • 48 months length goes with interest rate of 3.81 percent
  • 60 months length goes with interest rate of 3.93 percent
  • 72 months length goes with interest rate of 3.78 percent

It is known that a long length loan allows a low repayment and the 72/84 month plan are normally made for bigger car loan amount.

Let’s take an example, when paying for 48 month length, a $50,000 car loan at a 4.5% interests, you have to pay a monthly fee of $1,140, which will become $54,728. But once you chose to pay for the period of 84 month length which becomes $696 monthly repayments, the total loan becomes $58,380. This simply mean that it becomes over $3,600 more expensive than the 48 months length.


As at 10 years ago, the U.S. car loan length were about 3 to 4 years, and sometimes 5 years. But as car makers decided to raise their car price, dealers and loan givers decided to look for other methods to adhere to customers’ demands to get costlier cars by depositing a lower amount of money. These firms got a solution which is a long car loan length.

However, within the third month of 2015, about 43.5 per cent of persons purchasing newer cars have collected loans for about 5 years to 6 years loan length.

This info noted that about 27.5% of people buying cars had even longer loan length to make their monthly repayments which is 6 to 7 years. So the typical car loan length has also grown longer for used car purchasers, about 51.3% of them chose 5 to 6 years car loan length. However, there are 17.2% of used car buyers that finance their cars within 6 to 7 years length.

This simply means that over half of new car purchasers get loans for within 5 years and beyond, and 57.5% of the used car purchasers get a car loan length of 5 years and beyond.

In Summary On the average car loan length

Though it is vital to be aware of what you intend to pay when it comes to the length of the car repayment, the length should not be the way you measure a great car loan. Check out all the documents that are been presented before you, so that you will understand how you will repay the loan.

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