{"id":1403,"date":"2025-07-15T18:52:21","date_gmt":"2025-07-15T18:52:21","guid":{"rendered":"https:\/\/ft365.org\/index.php\/2025\/07\/15\/impact-of-aging-vehicles-on-car-financing-bankrate\/"},"modified":"2025-07-15T18:52:21","modified_gmt":"2025-07-15T18:52:21","slug":"impact-of-aging-vehicles-on-car-financing-bankrate","status":"publish","type":"post","link":"http:\/\/ft365.org\/index.php\/2025\/07\/15\/impact-of-aging-vehicles-on-car-financing-bankrate\/","title":{"rendered":"Impact of Aging Vehicles on Car Financing | Bankrate"},"content":{"rendered":"
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Key takeaways<\/span> <\/span> <\/h2>\n
    \n
  • Consumers are holding on to their cars longer due to rising new car prices, increased vehicle reliability and personal finance goals like avoiding monthly payments. <\/li>\n
  • Older cars are harder to finance due to lender restrictions around age and mileage. <\/li>\n
  • Borrowers may face higher interest rates, shorter loan terms or even loan denials when trying to finance aging vehicles. <\/li>\n<\/ul><\/div>\n

    \u201cI would never purchase a new car unless I won the lottery,\u201d confesses Bankrate editor Natasha Cornelius, who owns a 2011 Jeep Patriot. Her car has been paid off since 2016, and her insurance only comes out to be around $53 after discounts.\u00a0<\/p>\n

    Like her, many Americans are holding on to their vehicles longer than ever. The average age of passenger cars on U.S. roads is projected to reach 14.1 years in 2025, according to research by Hedges & Company<\/u>.<\/p>\n

    What does this mean for drivers, especially those who are looking into financing a car today? Whether you\u2019re thinking about keeping your old car or buying a used one, aging vehicles affect loan eligibility, interest rates and insurance costs \u2014 and can even change how long you\u2019ll be allowed to borrow.<\/p>\n

    Cars are aging on U.S. roads\u00a0<\/h2>\n

    The average vehicle on American roads is older than ever, and several key trends are driving this shift.\u00a0<\/p>\n

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    • <\/li>\n
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    • <\/li>\n<\/ul>\n

      Why vehicle age matters for auto loans\u00a0<\/h2>\n

      While older vehicles are becoming more common, financing them isn\u2019t always easy. Age and mileage restrictions, higher interest rates and shorter loan terms can all make it harder, and more expensive, to borrow.<\/p>\n

      1. Age limits on underwriting<\/h3>\n

      Vehicle prices remain high, and older cars are starting to make up a larger share of the market. Without financing, purchasing a reliable used vehicle becomes much harder. For many drivers, it can also mean delaying replacement or relying on cash purchases. \u00a0<\/p>\n

      Many lenders set strict age or mileage cutoffs for vehicle loans, often capping eligibility at 10 years old or 125,000 miles. If the car exceeds these limits, you may struggle to qualify for financing at all. Even when used auto loans are approved, lenders may shorten the term length or increase other restrictions to mitigate risk, adding to your costs as a borrower.<\/p>\n

      2. Loan rates skew higher<\/h3>\n

      Used vehicles, especially older models, are considered riskier collateral by lenders. The older the car, the more expensive the loan can become in terms of annual percentage rate (APR). As a result, buyers financing these cars often face higher interest rates compared to new or low-mileage vehicles.\u00a0<\/p>\n

      For borrowers with less-than-perfect credit, this risk is compounded. High rates can significantly increase monthly payments or the overall cost of the loan, making affordability a challenge even on older, seemingly budget-friendly cars.\u00a0<\/p>\n

      3. Shorter repayment periods<\/h3>\n

      Lenders typically limit loan terms for older vehicles, with maximum repayment periods shrinking to 36 or 48 months. That means even if you finance a car at a manageable price, the condensed loan timeline can result in much higher monthly payments compared to financing a new vehicle over 60 to 72 months.\u00a0<\/p>\n

      Shorter repayment windows can strain household budgets, particularly for buyers already stretching to afford a replacement car. Understanding these term limits upfront can help you prepare for the real cost of financing and avoid payment shock. You can also use an auto loan calculator to estimate how much your monthly payment will be based on the loan terms offered to you.<\/p>\n

      How to finance an older vehicle smartly<\/h2>\n

      Even if you plan on shopping for a used car, the lasting impacts of the COVID-19 pandemic and new tariffs have made prices surge. There simply aren\u2019t as many vehicles available as there is demand, which makes it more difficult to find the right car.<\/p>\n

      If you\u2019re in the market for a high-mileage or older used car, these strategies can help:<\/p>\n

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      • Get preapproved before shopping:<\/strong> Being preapproved for an auto loan allows you to shop like a cash buyer.<\/li>\n
      • Shop multiple lenders:<\/strong> Know your lender\u2019s max car age limits before buying a vehicle, and use credit unions or online lending platforms in addition to dealerships.<\/li>\n
      • Consider a personal loan:<\/strong> If auto lenders are unwilling to finance an older car, consider taking out an unsecured personal loan instead.<\/li>\n
      • Keep the loan term short:<\/strong> Older cars depreciate quickly, so it\u2019s best to stick with shorter loan terms of 60 months or less so you avoid becoming upside down on your loan.<\/li>\n
      • Invest in inspections and car condition reports:<\/strong> Being thorough and getting a used car inspection may help you make a case with lenders and negotiate prices.<\/li>\n<\/ul>\n
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        Auto Car Icon<\/title> <\/svg> <\/p>\n
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        Financing an antique or classic car <\/p>\n

        There are some lenders that offer financing for antique or classic cars, though you may have better luck using a personal loan to buy a car. And once you buy your car, look into getting classic car insurance.<\/p>\n<\/p><\/div>\n<\/p><\/div>\n

        Why some drivers are sticking with older cars\u00a0<\/span> <\/h2>\n

        Buying a new car is fun, but the most financially savvy tactic may be simply sticking with the car you already own \u2014 and managing your auto loan well. Many consumers are intentionally avoiding new car purchases \u2014 and their reasons go beyond just cost. Here\u2019s what Bankrate staff and contributors had to say about keeping their older vehicles.<\/p>\n

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        <\/svg> <\/p>\n

        Bankrate staff insights <\/h4>\n<\/p>\n
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        “The car was paid off 18 years ago\u2026 insurance is cheap” <\/p>\n

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        Ben\u00e9t Wilson, lead writer for the Credit Cards Team at Bankrate, drives a 2006 Honda Accord she inherited in 2022. She sees no reason to switch when her car is paid off and insurance is cheap.<\/p>\n

        \u201cThe car was paid off 18 years ago! My insurance is cheap because I only have liability on it.\u201d And despite its older features, Wilson doesn\u2019t feel like she\u2019s missing out.<\/p>\n

        \u201cMy car has a CD player in it. I bought a Bluetooth converter on Amazon that uses my radio frequency so [I] use my iPhone for podcasts, music and calls. I have a phone holder so I can use Apple Maps. I learned how to drive a car before rearview cameras were a thing, so I don\u2019t miss that. The car also has a cigarette lighter adapter I can use to keep my phone charged, so I\u2019m good.\u201d<\/p>\n<\/p><\/div>\n

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        \"Ben\u00e9t Ben\u00e9t Wilson, Writer <\/span> <\/p>\n<\/p><\/div>\n<\/p><\/div>\n

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        “I’m likely to keep driving it until the wheels fall off” <\/p>\n

        \n

        Pippin Wilbers, editor for the Loans Team at Bankrate, owns a 2004 Honda Odyssey that\u2019s been in his family since 2006.<\/p>\n

        \u201cI\u2019ve been fairly lucky with the car in that, aside from an oil leak, it hasn\u2019t had any expensive, serious issues. However, it\u2019s certainly developed quirks over time \u2014 for example, the motors in the power windows gave out, so my wife rigged up a pulley that lets me lower and raise the driver\u2019s side window. She also had to disconnect the interior lights and radio so they\u2019d stop draining the battery.\u201d<\/p>\n

        Wilbers continues to weigh the pros and cons of getting a new vehicle, and whether it\u2019s worth an added expense.<\/p>\n

        \u201cMy wife and I have been saying \u201cWe should probably replace the Odyssey soon\u201d for the last five years or so. A couple factors have kept us from biting the bullet. One is that I mostly just use it for errands when my wife\u2019s using the other, newer car, and it works just fine for that.\u201d<\/p>\n<\/p><\/div>\n

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        \"Pippin Pippin Wilbers, Editor <\/span> <\/p>\n<\/p><\/div>\n<\/p><\/div>\n

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        “I’m very close to trading in” <\/p>\n

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        David Swann, an analyst at Bankrate, drives a Chevrolet Tahoe Z71 from 2011. For Swann, a trade-in might be worth it considering the repair costs on his current vehicle.<\/p>\n

        \u201cRecently [the vehicle] has become very troublesome \u2014 I had to fix a coolant and AC leaking issue that cost me a bit over $1,300. I only expect it to get worse. Last year something similar happened when the engine mount broke and then cost upwards of $500.\u201d<\/p>\n

        For Swann, the biggest obstacle against buying a new car comes down to cost.<\/p>\n

        \u201cI\u2019m very close to trading in \u2014 I very much agree with the unaffordable sentiment around the car market (my wife and I are expecting in September), and I have been looking for a reliable midsize to large SUV for us to replace mine. Everything just feels too expensive.\u201d<\/p>\n<\/p><\/div>\n<\/p><\/div>\n<\/p><\/div>\n<\/p><\/div>\n

        Bottom line<\/h2>\n

        With record-high car prices, tighter lending standards and better vehicle durability, it\u2019s no surprise that Americans are keeping their cars longer \u2014 or choosing to buy older ones.\u00a0<\/p>\n

        While it can be harder to finance an aging vehicle, it\u2019s not impossible. Know your lender\u2019s restrictions, shop around and consider alternatives like personal loans or buying in cash. And if your current car still runs reliably and doesn\u2019t cost a fortune to maintain, holding onto it might be the smartest financial move you make this year, especially if you choose to refinance your current auto loan at a lower rate.\u00a0<\/p>\n

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        Did you find this page helpful? <\/p>\n<\/p><\/div>\n

        Help us improve our content<\/p>\n<\/p><\/div>\n<\/p><\/div>\n","protected":false},"excerpt":{"rendered":"

        Key takeaways Consumers are holding on to their cars longer due to rising new car prices, increased vehicle reliability and personal finance goals like avoiding monthly payments. Older cars are harder to finance due to lender restrictions around age and mileage. Borrowers may face higher interest rates, shorter loan terms or even loan denials when<\/p>\n","protected":false},"author":2,"featured_media":1404,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[5],"tags":[],"class_list":["post-1403","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-latest-news"],"featured_image_urls":{"full":["http:\/\/ft365.org\/wp-content\/uploads\/2025\/07\/1403-cars-older-how-reshaping-auto-loans-2025.jpg",1280,720,false],"thumbnail":["http:\/\/ft365.org\/wp-content\/uploads\/2025\/07\/1403-cars-older-how-reshaping-auto-loans-2025-150x150.jpg",150,150,true],"medium":["http:\/\/ft365.org\/wp-content\/uploads\/2025\/07\/1403-cars-older-how-reshaping-auto-loans-2025-300x169.jpg",300,169,true],"medium_large":["http:\/\/ft365.org\/wp-content\/uploads\/2025\/07\/1403-cars-older-how-reshaping-auto-loans-2025-768x432.jpg",640,360,true],"large":["http:\/\/ft365.org\/wp-content\/uploads\/2025\/07\/1403-cars-older-how-reshaping-auto-loans-2025-1024x576.jpg",640,360,true],"1536x1536":["http:\/\/ft365.org\/wp-content\/uploads\/2025\/07\/1403-cars-older-how-reshaping-auto-loans-2025.jpg",1280,720,false],"2048x2048":["http:\/\/ft365.org\/wp-content\/uploads\/2025\/07\/1403-cars-older-how-reshaping-auto-loans-2025.jpg",1280,720,false],"morenews-featured":["http:\/\/ft365.org\/wp-content\/uploads\/2025\/07\/1403-cars-older-how-reshaping-auto-loans-2025-1024x576.jpg",1024,576,true],"morenews-large":["http:\/\/ft365.org\/wp-content\/uploads\/2025\/07\/1403-cars-older-how-reshaping-auto-loans-2025-825x575.jpg",825,575,true],"morenews-medium":["http:\/\/ft365.org\/wp-content\/uploads\/2025\/07\/1403-cars-older-how-reshaping-auto-loans-2025-590x410.jpg",590,410,true],"crawlomatic_preview_image":["http:\/\/ft365.org\/wp-content\/uploads\/2025\/07\/1403-cars-older-how-reshaping-auto-loans-2025-260x146.jpg",260,146,true]},"author_info":{"display_name":"henry","author_link":"http:\/\/ft365.org\/index.php\/author\/henry\/"},"category_info":"Latest News<\/a>","tag_info":"Latest News","comment_count":"0","_links":{"self":[{"href":"http:\/\/ft365.org\/index.php\/wp-json\/wp\/v2\/posts\/1403","targetHints":{"allow":["GET"]}}],"collection":[{"href":"http:\/\/ft365.org\/index.php\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"http:\/\/ft365.org\/index.php\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"http:\/\/ft365.org\/index.php\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"http:\/\/ft365.org\/index.php\/wp-json\/wp\/v2\/comments?post=1403"}],"version-history":[{"count":0,"href":"http:\/\/ft365.org\/index.php\/wp-json\/wp\/v2\/posts\/1403\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"http:\/\/ft365.org\/index.php\/wp-json\/wp\/v2\/media\/1404"}],"wp:attachment":[{"href":"http:\/\/ft365.org\/index.php\/wp-json\/wp\/v2\/media?parent=1403"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"http:\/\/ft365.org\/index.php\/wp-json\/wp\/v2\/categories?post=1403"},{"taxonomy":"post_tag","embeddable":true,"href":"http:\/\/ft365.org\/index.php\/wp-json\/wp\/v2\/tags?post=1403"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}