Long Auto Loan Terms in 2025: Pros and Cons of 84- and 96-Month Financing

In 2025, consumers are exploring a range of financing options for auto loans, and long-term loans—such as the 84-month and 96-month auto loans—are becoming more common. With these loans, buyers are looking to lower their monthly payments, but this comes with both benefits and risks. In this article, we’ll break down the pros and cons of these extended auto loan terms and help you decide whether it’s the right option for your next car purchase.

What Is an 84-Month or 96-Month Auto Loan?

Auto loans typically range from 36 to 72 months, but in recent years, many lenders have introduced long-term options up to 96 months (8 years). An 84-month auto loan lasts for 7 years, while a 96-month loan extends that period to 8 years. While the idea of lower monthly payments is appealing, the extended term also comes with considerations like higher interest payments and the risk of being upside down on your loan.

Pros of 84- and 96-Month Auto Loans

• Lower Monthly Payments: Longer terms can reduce your monthly payment significantly. If you're looking to get a more expensive car but want to stick to a specific budget, this is a compelling option.
• Improved Affordability: With lower payments, you can afford a more luxurious or higher-end vehicle without stretching your budget.
• Lower Interest Rates (in some cases): Some lenders offer lower rates on long-term auto loans, but this is not always guaranteed. Make sure to compare interest rates before committing.

Cons of 84- and 96-Month Auto Loans

• Higher Total Interest Costs: Even if you have a lower monthly payment, you’ll end up paying much more in interest over the life of the loan because the term is longer.
• Depreciation Risk: Cars depreciate quickly, and with a long-term loan, you may owe more than the car is worth for several years. This can lead to being “upside down” on your loan, where you owe more than the car is worth.
• Longer Commitment: Committing to an 84- or 96-month loan can feel like a financial burden if your circumstances change, like a new job or a move. It could become harder to get out of the loan without a significant financial hit.
• May Limit Future Financing Options: Being tied to a long-term auto loan could affect your ability to qualify for other loans, including mortgages or personal loans.

When Does an 84- or 96-Month Loan Make Sense?

Longer auto loans can make sense in certain situations. If you're purchasing a vehicle with a low interest rate, have a stable financial situation, and plan on keeping the car for many years, an 84- or 96-month loan can work. However, if you're planning to trade in your car before the loan term ends, or if you want to pay off the loan quickly, shorter terms may be more advantageous.

What Are the Alternatives to Long Auto Loan Terms?

• Shorter Loan Terms: Opting for a 36-month or 48-month loan could help you pay off the car faster and avoid excessive interest charges.
• Leasing: If you prefer to drive a new car every few years, leasing could be a good alternative. With leasing, you don’t have to worry about long-term depreciation and typically have lower monthly payments.
• Increasing Your Down Payment: A larger down payment can help reduce the loan term and interest paid over time, as well as help you avoid being upside down on the loan.

Example Calculation: 84-Month vs. 96-Month Loan

To give you an idea of the financial impact, here’s an example comparing an 84-month loan and a 96-month loan for a $30,000 car with a 5% interest rate.

Loan Term	Monthly Payment	Total Interest Paid	Total Paid (Principal + Interest)
84 Months	$402.45	$8,402.90	$38,402.90
96 Months	$375.68	$10,252.83	$40,252.83

Note: The calculation assumes a 5% annual interest rate. Exact amounts may vary based on your credit score, down payment, and lender.

FAQs about Long Auto Loans in 2025

1. Are 96-month auto loans common?

While 96-month loans are becoming more common, most lenders still prefer 72 months or less. Make sure you understand the risks before committing to such a long term.

2. Can I refinance my long-term auto loan?

Yes, refinancing is an option, but it depends on your vehicle’s value and your credit situation. Refinancing may help lower your interest rate or reduce the loan term.

3. How can I avoid being upside down on my loan?

Make a larger down payment, or consider a shorter loan term to ensure the car's depreciation doesn’t outpace your loan balance.

4. Can I get a lower interest rate on a 96-month loan?

It’s possible, but not guaranteed. The longer the loan term, the more risk the lender takes on, so interest rates could be higher for long-term loans.

5. Should I get an 84-month or 96-month loan?

If keeping monthly payments low is your primary concern, then these long-term loans may work. But remember the long-term cost in terms of total interest and depreciation.

Call to Action

Looking for the best auto loan deal in 2025? Compare rates now or speak to an auto loan expert to find the best term for your needs!

Disclaimer

This content is for informational purposes only and should not be considered financial advice. Always consult with a licensed financial advisor or auto loan specialist before making decisions about your loan terms.