60 vs. 72 Month Car Loan: Which Is Better?
The most common car loan terms are 60 months (5 years) and 72 months (6 years). The appeal of the 72-month loan is obvious: a lower monthly payment. The hidden cost is the extra interest.
Here's the real math so you can decide.
The Numbers, Side by Side
A $35,000 car at 7% APR:
| 60-month loan | 72-month loan | |
|---|---|---|
| Monthly payment | $693 | $597 |
| Total paid | $41,583 | $42,964 |
| Total interest | $6,583 | $7,964 |
The 72-month loan saves you about $96 per month, but it costs about $1,381 more in interest over the life of the loan.
💡 Run your own comparison: Use the auto loan calculator to plug in your car price and rate and see both terms side by side.
The Underwater Problem
There's another risk with longer terms that has nothing to do with interest: negative equity.
Cars lose value fast — often 20% in the first year and 60% by year five. With a 72-month loan and a small down payment, you pay the loan down slower than the car depreciates. Result: you owe more than the car is worth, which becomes a problem if you want to sell or trade it early.
When a 72-Month Loan Makes Sense
- The APR is very low (sometimes a 72-month loan at 0–3% APR beats a shorter loan at a higher rate).
- You have stable income and truly need the lower payment.
- You plan to keep the car for the full term.
When to Choose 60 Months
- You can afford the higher payment.
- You want to pay less total interest.
- You want to stay above water on the loan.
Frequently Asked Questions
Is a 72-month car loan a bad idea?
Not always, but it's usually more expensive. It's fine if the rate is low or you need the lower payment — just know you're paying more total interest and building equity slower.
What's the ideal car loan term?
For most buyers, 48–60 months is the sweet spot: affordable payment, less total interest, and you stay ahead of depreciation.
Can I pay off a 72-month loan early?
Usually yes, with no prepayment penalty. Paying extra toward the principal shortens the term and cuts your interest — but only if the loan allows early payoff without fees.
Compare terms instantly with the RateLedger auto loan calculator.