Longer Loans Appealing to More But Can Cost Both Buyers, Dealers
Consumers are turning to longer automobile loans to keep their monthly payments low, according to the Dallas Morning News. While six-year loans might make new cars and trucks more attainable, they may prove to be a bigger problem than solution, some dealers say.
Among them: Consumers, in the long term, could slide deeper into debt. And local dealers – who for nearly a decade have counted on consistent sales growth in one of the nation's strongest new-vehicle markets – could see more peaks and valleys in their business as people are forced to keep their heavily financed vehicles for a longer time, the News said.
Six-year financing is not yet a major issue with the nation's car dealers and might not become one if the economy continues to strengthen, pushing up the value of trade-ins and used cars, according to Paul Taylor, chief
economist at the National Automobile Dealers Association (NADA).
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