Car payments for new cars now average over $750 a month, leading lenders to offer loans stretching up to 10 years. New vehicle prices have increased by over 30% since 2020, with the average sticker price exceeding $50,000. Buyers are now opting for longer loan terms, with some loans extending past 100 months.

Auto debt in the US is now around $1.6 trillion, with increasing signs of strain as delinquencies near 15-year highs. High monthly payments are contributing to the rise in delinquencies, according to data from the Federal Reserve. Automakers have shifted away from affordable options, focusing on higher-margin models, as tariffs add to price pressures.

Used car prices have risen by 3.6% since 2024, limiting buyers’ negotiating power, especially for trucks and larger SUVs. The prevalence of 100-month car loans reflects a market where prices have outpaced incomes, forcing Americans to seek longer loan terms to afford necessary vehicles.

Read more at Yahoo Finance: As car prices rises, auto loans stretch to 10 years or more