How many years is a 60 month loan?
The biggest advantage of 60-month car loans is that you have five years to pay them off. Because of this, your monthly payments will be much lower than if you have a three or four year loan.
Auto loans over 60 months are not the best way to finance a car because, for one thing, they carry higher car loan interest rates. Yet 39% of new-car buyers in the first quarter of 2021 took out loans of 61 to 72 months, according to Experian.
Your lender typically sets a required monthly payment when you take out a loan, such as a 60-month auto loan. That payment is calculated so that you pay off the loan gradually over the loan's term. Your last payment will exactly cover what you owe at the end of the fifth year.
For example, if the approximate term of the loan is 4 years or 48 months, you would enter 48 in the # of Payments blank. Principal is the amount of money you want to borrow.
Number of Months: The number of months refers to the loan term broken down by the total months you have to repay it. For example, you have 360 months to repay a 30-year mortgage and 60 months to repay a 5-year personal or auto loan.
According to the results, it will take you 60 months, an interest rate of 5% of $2,645, to fully pay your $20,000 car loan. However, the monthly cost of a $20,000 car loan will depend on your repayment period and the annual percentage rate (APR).
It is possible to pay off your car loan early but check your financing documents first to see if there is a penalty for pre-paying your loan.
Average interest rates for car loans
The average APR on a new-car loan with a 60-month term was 4.96% in the first quarter of 2021, according to the Federal Reserve. But as mentioned above, your credit scores and other factors can affect the interest rate you're offered.
The total interest amount on a $30,000, 72-month loan at 5% is $4,787—a savings of more than $1,000 versus the same loan at 6%. So it pays to shop around to find the best rate possible.
72-Month Car Loan Rates Are Typically High
To compensate for the added risk, they often charge higher annual percentage rate (APR) or interest rates. There's no benefit to paying more money in interest, and it's considered by some to be wasted money.
How much is the $40,000 car payment for 60 months?
When the loan term changes to 60 months, the monthly payment on a $40000 car loan will be $738.83.
For $40,000 loans, monthly payments averagely range between $900 and $1,000, depending on the interest rate and loan term.
For instance, using our loan calculator, if you buy a $20,000 vehicle at 5% APR for 60 months the monthly payment would be $377.42 and you would pay $2,645.48 in interest.
Some lenders use specialized credit scores, such as a FICO Auto Score. In general, you'll need at least prime credit, meaning a credit score of 661 or up, to get a loan at a good interest rate. If you have poorer credit, you can still get a loan, but you will probably have to pay more for it or else find a co-signer.
- Setting a Target Date. ...
- Making a Higher Down Payment. ...
- Choosing a Shorter Home Loan Term. ...
- Making Larger or More Frequent Payments. ...
- Spending Less on Other Things. ...
- Increasing Income.
Example 1: A $10,000 loan with a 5-year term at 13% Annual Percentage Rate (APR) would be repayable in 60 monthly installments of $228 each. The actual payment amount and year-end balance will vary based on the APR, loan amount, and term selected.
Your car payment won't go down if you pay extra, but you'll pay the loan off faster. Paying extra can also save you money on interest depending on how soon you pay the loan off and how high your interest rate is.
Down Payment Rules to Live By
A good rule of thumb for a down payment on a new car loan is 20% of the purchase price. A down payment of 20% or more is a way to avoid being “upside down” on your car loan (owing more on the car than it's worth).
With a $1,000 down payment and an interest rate of 20% with a five year loan, your monthly payment will be $768.32/month.
Paying off your car early eliminates your auto loan from the equation. Your DTI will naturally be lower, which opens you up for other forms of credit. It also helps improve your chances of refinancing other loans or consolidating credit card debt at a lower rate.
Will your credit score drop if you pay off a car loan early?
Paying off your car loan early can hurt your credit score. Any time you close a credit account, your score will fall by a few points. So, while it's normal, if you are on the edge between two categories, waiting to pay off your car loan may be a good idea if you need to maintain your score for other big purchases.
Lenders like to see a mix of both installment loans and revolving credit on your credit portfolio. So if you pay off a car loan and don't have any other installment loans, you might actually see that your credit score dropped because you now have only revolving debt.
There's no set minimum credit score required to get an auto loan. It's possible to get approved for an auto loan with just about any credit score, but the better your credit history, the bigger your chances of getting approved with favorable terms.
The car payments on a 70,000 dollar car loan vary based on the type of vehicle, new versus used, your credit score, and the sales tax rate of your state. The monthly car payments on a $70K car loan range from $1,168.16 to $1,925.96.
Here's a quick look at how a good credit score can benefit you when you're buying a car. Lower interest rates. A good credit score — typically a score of 680 or higher — can help you secure a low interest rate from the dealer. In fact, taking your score from 600 to 780 could halve your rate.
Example 2: A $25,000.00 secured personal loan financed for 60 months at an interest rate of 8.500% would yield an APR* (Annual Percentage Rate) of 8.496% and 59 monthly payments of $512.87 and 1 final payment of $513.24. *These examples are for illustrative purposes only.
The monthly car payments on a $45K car loan range from $754.27 to $1,243.58.
In terms of the best time of the year, October, November and December are safe bets. Car dealerships have sales quotas, which typically break down into yearly, quarterly and monthly sales goals. All three goals begin to come together late in the year.
| Lender With Best Auto Loan Rates | Minimum APR | Minimum Credit Score |
|---|---|---|
| AUTOPAY | 2.99% | 560 |
| PenFed Credit Union | 5.19% | 650 |
| Chase | 6.34% | None |
| Consumers Credit Union | 5.54% | 620 |
Fewer years to pay
A longer loan term could mean making payments for five to seven years. A shorter, two- to four-year term will put you in full possession of your car much sooner, which means you'll get the money back in your monthly budget and can use it to pay down higher-interest debts or save.
What is a good interest rate for a car for 72 months 2023?
| Lender | Starting APR | Award |
|---|---|---|
| 1. MyAutoloan | 5.04% for 72-month auto loans | Best Low-Rate Option |
| 2. Autopay | 2.99%* | Most Well-Rounded |
| 3. Consumers Credit Union | 5.64% for 72-month loans | Most Flexible Terms |
| 4. PenFed Credit Union | 5.84% for 72-month loans | Most Cohesive Process |
If your take-home pay is $60,000 per year, you should pay no more than $750 per month for a car, which totals 15% of your monthly take-home pay.
Experts say your total car expenses, including monthly payments, insurance, gas and maintenance, should be about 20 percent of your take-home monthly pay. For non-math wizards, like me – Let's say your monthly paycheck is $4,000. Then a safe estimate for car expenses is $800 per month.
Generally, however, a car payment is considered high if it exceeds 10-15% of a person's gross monthly income. This means that if a person earns $3,000 per month, a car payment that is greater than $300-$450 per month may be considered high.
The monthly car payments on a $35K car loan range from $588.72 to $970.62.
How much is a lease for a $45,000 car? Using our calculator, we input a $5,000 down payment, an assumed $25,000 residual value, an interest rate of 7% and a term of 36 months (three years). It resulted in monthly payment of $606 before taxes.
The car payments on a 80,000 dollar car loan vary based on the type of vehicle, new versus used, your credit score, and the sales tax rate of your state. The monthly car payments on a $80K car loan range from $1,333.72 to $2,198.91.
On a $200,000, 30-year mortgage with a 4% fixed interest rate, your monthly payment would come out to $954.83 — not including taxes or insurance. But these can vary greatly depending on your insurance policy, loan type, down payment size, and more.
For example, if you take out a $50,000 loan for one year with an APR of 36%, your monthly payment will be $5,023. But if you take out a $50,000 loan for seven years with an APR of 4%, your monthly payment will be $683.
On a $300,000 mortgage with a 3% APR, you'd pay $2,071.74 per month on a 15-year loan and $1,264.81 on a 30-year loan, not including escrow. Escrow costs vary depending on your home's location, insurer, and other details.
Can I get a Tesla with a 650 credit score?
The company doesn't list a minimum credit score requirement for a Tesla auto loan or lease. However, borrowers with good or excellent credit have a higher chance of qualifying and getting a lower interest rate.
What credit score do I need to finance a Tesla? Tesla does not state a minimum credit score for financing. However, as with other brands, you will have much better luck securing a lower APR if you have a better score. Try aiming for a credit score of 720 or higher to get the best possible rate.
| 760-850 | 6.726 % |
| 700-759 | 6.948 % |
| 680-699 | 7.125 % |
| 660-679 | 7.339 % |
| 640-659 | 7.769 % |
The Bottom Line
Paying off your mortgage early can save you a lot of money in the long run. Even a small extra monthly payment can allow you to own your home sooner. Make sure you have an emergency fund before you put your money toward your loan.
Making additional principal payments will shorten the length of your mortgage term and allow you to build equity faster. Because your balance is being paid down faster, you'll have fewer total payments to make, in-turn leading to more savings.
Any outstanding balance on your loan will be forgiven if you haven't repaid your loan in full after 20 years (if all loans were taken out for undergraduate study) or 25 years (if any loans were taken out for graduate or professional study).
What income is required for a 200k mortgage? To be approved for a $200,000 mortgage with a minimum down payment of 3.5 percent, you will need an approximate income of $62,000 annually. (This is an estimated example.)
A $300,000 house, with a 5% interest rate for 30 years and $15,000 (5%) down will require an annual income of $77,087. This calculation is for an individual with no expenses. Use the calculator above to determine the income you need to purchase a $300,000 home.
For example, if you take out a five-year loan for $20,000 and the interest rate on the loan is 5 percent, the simple interest formula would be $20,000 x .05 x 5 = $5,000 in interest.
The biggest advantage of 60-month car loans is that you have five years to pay them off. Because of this, your monthly payments will be much lower than if you have a three or four year loan. More time equals more time to pay.
What is a good APR for a 60-month car loan?
Depending on your credit score, the 60-month car loan will range from 3.24% to 13.97% on average. app—we'll help you easily compare personalized quotes from over 50 insurers. Best of luck with your car loan!
You'll likely have to pay a higher interest rate.
A longer term is riskier for the lender because there's more of a chance interest rates will change dramatically during that time. There's also more of a chance something will go wrong and you won't pay the loan back.
This is why Edmunds recommends a 60-month auto loan if you can manage it. A longer loan may have a more palatable monthly payment, but it comes with a number of drawbacks, as we'll discuss later. The trend is actually worse for used car loans, where just over 80% of used car loan terms were over 60 months.
Generally, however, a car payment is considered high if it exceeds 10-15% of a person's gross monthly income. This means that if a person earns $3,000 per month, a car payment that is greater than $300-$450 per month may be considered high.
Can you pay off a 72-month car loan early? Yes, you can pay off a 72- or 84-month auto loan early. Since these are long repayment terms, you could save considerable money by covering the interest related to a shorter period of time.
The total interest amount on a $30,000, 72-month loan at 5% is $4,787—a savings of more than $1,000 versus the same loan at 6%. So it pays to shop around to find the best rate possible.
| Credit score | Average APR, new car | Average APR, used car |
|---|---|---|
| Superprime: 781-850. | 4.75%. | 5.99%. |
| Prime: 661-780. | 5.82%. | 7.83%. |
| Nonprime: 601-660. | 8.12%. | 12.08%. |
| Subprime: 501-600. | 10.79%. | 17.46%. |
Paying off the loan early can put you in a situation where you must pay a prepayment penalty, potentially undoing any money you'd save on interest, and it can also impact your credit history.
The average interest rate on a new car loan with a credit score of 750 is 4.90%, while the average interest rate on a used car loan is 5.47%.
A longer loan term will lower the monthly payment, but you will end up paying more interest over the life of the loan. A shorter loan term means you will pay less interest overall, but your monthly payments will be higher.
What is the most common car loan length?
The most common loan length is currently 72 months for both new and used vehicles. The average length of a car loan changes from time to time, and 72 months is a bit higher than in previous decades.
Car payment statistics
The average monthly car payment for new cars is $716. The average monthly car payment for used cars is $526. 39.5 percent of vehicles financed in the fourth quarter of 2022 were new vehicles. 60.5 of percent of vehicles financed in the fourth quarter of 2022 were used vehicles.
The 20/4/10 rule encourages consumers to put down at least 20% of the total price of their vehicle, which will lower the overall amount you borrow and reduce the interest you'll pay over the life of the loan. While there are no-money-down car loans, not providing a down payment can cost you more in the long run.
