Is It Dumb To Finance A Car For 72 Months?


Purchasing a car is a significant investment. A vehicle can easily cost more than most people’s annual salaries, and it’s no wonder that many people find themselves considering a 72-month car loan. With the low monthly payments advertised on these loans, it is easy to see why many people opt for them, especially if their budget is tight. However, it’s important to understand that a 72-month car loan has its advantages and disadvantages. In this article, I will explore both sides of the debate and shed some light on whether financing a car for 72 months is a good idea.

The Pros of Financing a Car for 72 Months

The most apparent advantage of financing a car for 72 months is the low monthly payment. Since the loan is spread out over six years, the monthly payments are considerably smaller than if you were to finance the car over a shorter period. This can make having a car more affordable and help those with a tight budget.

Another advantage of a 72-month car loan is that it can help you to afford a better car, with more features and a higher price tag. Since the monthly payment is lower, you may be able to afford a car with features that you previously thought were out of your budget.

Bullet points of Pros

  • Low monthly payment makes it affordable for those with tight budgets
  • Affords one the opportunity to purchase a better car

The Cons of Financing a Car for 72 Months

The most significant disadvantage of financing a car for 72 months is that it can cost more in the long run. Since you will be paying interest on the loan for six years, you will end up paying more than you would have if you had taken out a shorter loan. Additionally, because a longer-term loan means the lender can spread out the risk over a more extended period, the interest rates are generally higher than shorter-term loans.

Another disadvantage of a 72-month car loan is that it can leave you underwater on the loan. This means that you owe more on the car than it’s worth, and it can be difficult to sell the vehicle or refinance the loan if you need to.

Bullet points of Cons

  • Costs more in the long run due to interest rates and longer repayment period
  • May put you underwater on the loan

The Risks of Extended Auto Loans

There are several significant risks of taking out an extended auto loan. One of the most significant risks is that the car could depreciate faster than the loan balance decreases. This means that you could end up with negative equity in the vehicle and owing more than it’s worth. This would make selling the car or trading it in very difficult.

Another major risk of an extended auto loan is the chance of defaulting. With a 72-month loan, there’s a higher likelihood that your financial situation could change over time, making it challenging to make payments. Missed payments can lead to late fees and damage your credit score.

Bullet points of Risks

  • The car could depreciate faster than the loan balance decreases
  • Increased possibility of defaulting

The Financial Impact of a 72-Month Auto Loan

The financial impact of taking out a 72-month auto loan can be significant. As previously stated, the longer repayment period means that you’ll end up paying more interest over the life of the loan, which could result in an overall higher cost for the car. Additionally, the higher interest rates can compound the problem further.

Another significant financial impact is the fact that you’re committing yourself to a long-term repayment plan. Things like job loss or other financial obligations could make it difficult to maintain those payments, which can have a domino effect on your credit score and could put you in a more challenging financial position.

Bullet points of Financial Impacts

  • Higher cost due to more interest paid
  • Long-term commitment

Who Should Opt for a 72-Month Auto Loan?

Only people with excellent credit scores should consider taking out a 72-month auto loan. In this case, the lower interest rate can offset the cost of the longer-term, making it more manageable.

Additionally, people who plan to keep their cars for a long time, and who don’t want to worry about selling or trading in their vehicles, may find a 72-month auto loan more attractive.

Bullet points of Eligibility

  • Excellent credit score
  • Plan to keep the car for a long time

Alternatives to a 72-Month Auto Loan

If you’re unable or unwilling to take on a 72-month auto loan, there are other financing options available. For example, taking out a shorter-term loan over 36 or 48 months will save you money on the overall cost of the car. Alternatively, if you’re looking for a lower monthly payment, consider leasing the car instead.

Bullet points of Alternatives

  • Shorter-term loan
  • Leasing the car


While a 72-month auto loan may seem like a good idea to those with a tight budget or who want to purchase a higher-end car, it’s essential to consider the overall financial impact. Ultimately, if you have excellent credit, plan on keeping the car for a long time, and can manage the long-term commitment, a 72-month auto loan could be a suitable option. However, for most people, choosing a shorter-term loan, leasing the car, or opting for a less expensive vehicle is the wisest decision to make.

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