Car Payments Have Become The New Mortgage As Some Americans Face 100-Month Loans

Car payments are rising so fast that many households now carry them like a second mortgage, and a small but growing slice of borrowers are stretching loans close to 100 months (over 8 years) to make vehicles “affordable.” This keeps monthly payments lower but dramatically increases total interest cost and the risk of owing more than the car is worth for most of the loan term.​

What’s actually happening

• The average payment on a new car is now about 740–760 dollars a month, with average loan amounts a little over 42,000 dollars.​

• New-vehicle prices have climbed roughly one-third since 2020, with average sticker prices around or just above 50,000 dollars.​

• Average loan terms are close to 69 months (nearly 6 years), and loans over 72 months are increasingly common, including 84‑month and a niche of 85–100‑month products.​

The 100‑month loan trend

• Some lenders and dealers now offer auto loans stretching to roughly 100 months, mainly on expensive pickups and SUVs, marketed as a way to “get the payment down.”​

• In the broader market, loans of 85–96 months make up a small but rising share (a bit over 1 percent of buyers through 2025), with a few going all the way to about 100 months.​

Why this is like a second mortgage

• Household budgets are absorbing car payments similar to housing payments, with many families sending 700–1,000 dollars a month to the auto lender, often alongside a traditional mortgage or high rent.​

• Because cars depreciate, very long loans can leave borrowers “underwater” (owing more than the car’s value) for much of the term, unlike a typical mortgage where the asset may appreciate.​

The real cost of super‑long loans

• On a 50,000‑dollar car, a shorter loan (around 5 years) might mean a payment near 900–950 dollars and around 6,000–7,000 dollars in total interest, depending on rate.​

• Stretching that same purchase close to 100 months can cut the payment by several hundred dollars per month but can more than double the total interest paid over the life of the loan.​

How to protect yourself

• Aim for the shortest term you can reasonably afford; many consumer advocates suggest capping new‑car loans at about 60 months and used‑car loans even shorter when possible.​

• Focus on the total price and total interest, not just the “affordable” monthly payment, and consider cheaper vehicles or buying used to avoid treating a car like a long‑term mortgage‑sized commitment.​