Letting Go of Long-Term Loans
Years ago, vehicle-loan terms typically ran for three years. Nowadays, however, the average used-vehicle loan is 62 months, and more than 30 percent of new-vehicle loans exceed 72 months, according to Experian. For a country that has troubles with commitment, that’s a lot of long-term love, or should we say long-term debt? The only advantage of a 72- or 84-month loan is that stretching payments over a longer term reduces the monthly payment. The major disadvantage, however, is that you’re going to pay a lot more in interest over the course of the loan.
Considering this new financial reality, it’s important to manage all your debts effectively. That’s where a nonprofit such as Cambridge Credit Counseling can help. Cambridge’s independently certified counselors can help you explore your options when it comes to managing high credit card balances and other unsecured debts, potentially saving you substantial interest on those bills. Contact a Cambridge counselor today at 888/842-8993 or online at cambridge-credit.org/AAA.
This article originally appeared in the September/October 2019 edition of AAA World.