SANTA MONICA, Calif., July 3, 2017 /PRNewswire/ -- As car buyers' appetites for bigger and more expensive vehicles grows, so does their willingness to take longer paying for them, according to a new analysis from Edmunds, the leading car shopping and information platform. The average auto loan length reached an all-time high of 69.3 months in June — up 6.8 percent from five years ago. The average amount buyers financed recorded the biggest uptick for the year, hitting $30,945 (up $631 from May), also leading to the highest monthly payments for the year, now averaging $517 (up from $510 in May).
"Stretching out loan terms to secure a monthly payment they're comfortable with is becoming buyers' go-to way to get the cars they want, equipped the way they want them," said Edmunds Executive Director of Industry Analysis Jessica Caldwell. "It's financially risky, leaving borrowers exposed to being upside down on their vehicles for a large chunk of their loans, but it's also a sign that consumers are still confident enough in the economy to spend more on their vehicles and commit to paying for them longer."
Edmunds also finds that the APR dipped just below 5 percent for the first time since February, averaging 4.96 in June. The APR has increased 5.7 percent from a year ago and 13.6 percent from five years ago.
About Edmunds Edmunds is the leading car information and shopping platform, helping millions of visitors each month find their perfect car. With products such as Edmunds Your Price, Your Lease and Used+, shoppers can buy smarter with instant, upfront prices for cars and trucks currently for sale at more than 13,000 dealer franchises across the U.S. Edmunds' in-house team of unbiased car-shopping experts provide industry-leading vehicle reviews and shopping tips, as well as welcome all car-shopping questions to the free Shopper Advice line at 1-855-782-4711, via email at [email protected], via text at ED411 and on Twitter and Facebook. The company is regarded as one of America's best workplaces by Fortune and Great Place to Work. Edmunds is based in Santa Monica, California, and has a satellite office in downtown Detroit, Michigan.