When it comes to buying a car, one of the biggest decisions people face is how to finance it. Most people turn to car loans to help them cover the cost, but the terms of these loans can vary. One important factor that impacts how much you pay over time is the loan tenure, which is simply how long you have to pay back the loan. In this article, we will explore how loan tenure affects car loan interest rates, including the difference between used car loan interest rates and new car loan rates, and how using loan apps can make a difference in finding the right deal.

Understanding Loan Tenure

Loan tenure refers to the time period over which you agree to pay back your loan. For car loans, this typically ranges from 2 to 7 years. Choosing a longer tenure means you’ll have lower monthly payments, but it also means you’ll end up paying more in interest over time. On the other hand, a shorter loan tenure means higher monthly payments, but less interest paid overall.