US car loan borrowers extend terms as monthly payments hit record high

In the United States, new‑vehicle financing reached new extremes in the second quarter of 2026. A record 36.5 % of borrowers took loans lasting 73 months or longer, up from 27.3 % a decade earlier, and 23.9 % signed up for 84‑month loans, meaning roughly one in four new‑car purchasers are financing for seven years.

The average monthly payment rose to $777, the highest for three consecutive quarters, while 20.3 % of borrowers now pay $1,000 or more each month. The average amount financed hit $44,156, and down‑payments fell to $5,815, representing just 11.6 % of the purchase price – the lowest share since 2020. Total interest paid over the life of a loan climbed to a record $9,811, with the average annual percentage rate at 7 %. Zero‑percent financing vanished, accounting for only 1.2 % of loans.

Used‑vehicle financing showed similar pressure: 6.3 % of used‑car loans had monthly payments of $1,000 or more, and the average loan amount rose to $30,414.