97-Month Car Loan

97-Month Car Loan - A 97-month car loan, which is just a little more than eight years, can mean less down payment, lower monthly car payments, and being able to afford a higher-priced car. For car buyers, banks, and auto sales companies, offering a 97-month car loan is becoming an important trend that is “rippling through the U.S. auto industry,” reported The Wall Street Journal via Yahoo! Finance on April 8, 2013.


A 97-month car loan appears to be a win-win situation for everyone involved.

According to The Wall Street Journal, the average price of a new car is now $31,000. Four years ago, the average price of a car was $28,000.

By offering a 97-month car loan, banks, lenders, and the auto industry can attract more car buyers who would benefit from lower monthly payments of under $500 over a longer period of time with less interest.

Car buyers appear to take advantage of longer car loan payments.

“In the final quarter of 2012, the average term of a new car note stretched out to 65 months, the longest ever, according to Experian Information Solutions Inc. Experian said that 17% of all new car loans in the past quarter were between 73 and 84 months and there were even a few as long as 97 months.”

While some car makers are ready to jump into the competition of offering a 97-month car loan in order to attract more car buyers, other car makers who are concerned about selling less used cars still have mixed feelings about the extended car loan.

Since the financial crisis five years ago has improved, more banks are now willing again to ease credit standards and to offer longer term loans. “Credit availability has played a key role in the auto industry's ups and downs.”

For some car buyers, the idea of having the same car for more than eight years might sound unappealing. For some other car buyers, however, having a 97-month car loan might make the difference of not having to deal with the troubles a used car might bring and being able to buy a car that meets one’s needs.

Source: examiner