Why Choose a 72-Month Auto Loan?
72-month auto loans have become increasingly popular because they significantly lower monthly payments compared to traditional 48 or 60-month terms. This extended financing allows buyers to afford newer vehicles with more features or simply free up monthly cash flow for other expenses.
72-Month Auto Loan: Pros and Cons
Advantages:
- Lower Monthly Payments: Spreading payments over 72 months reduces monthly costs by 15-25% compared to 60-month loans
- Access to Better Vehicles: Lower payments may allow you to afford a newer, more reliable car
- Improved Cash Flow: More money available each month for other financial goals
- Budget Flexibility: Easier to manage monthly expenses with lower car payments
Disadvantages:
- Higher Total Interest: You'll pay significantly more in total interest over the loan term
- Slower Equity Building: Takes longer to build positive equity in your vehicle
- Risk of Being Underwater: Vehicle depreciation may outpace loan paydown initially
- Longer Commitment: Six years is a long time to be committed to one vehicle
💡 72-Month Loan Strategy
A 72-month loan can be smart if you need lower monthly payments and plan to keep the car long-term. However, avoid this term if you tend to trade vehicles frequently or want to minimize total interest costs.
When 72-Month Loans Make Sense
Consider a 72-month auto loan when:
- You plan to keep the vehicle for the entire loan term
- Lower monthly payments significantly improve your budget
- You're buying a reliable vehicle that will last beyond the loan term
- You can invest the monthly savings at a higher return than your loan rate
Alternatives to Consider
Before committing to a 72-month term, consider these alternatives:
- Larger Down Payment: Reduce the loan amount instead of extending the term
- Less Expensive Vehicle: Choose a car that fits comfortably in a shorter loan term
- Certified Pre-Owned: Get a newer vehicle with warranty protection at a lower price
- 60-Month Loan: Balance between payment and interest costs