 TITLE: Are 84-Month Auto Loans a Good Idea? CONTENT: When an 84-Month Car Loan Might Make Sense\n------------------------------------------\nStretching out your repayment schedule over seven years can lower your monthly car payments significantly compared with, say, a three-year or even five-year loan. This can allow you to buy a car that might not otherwise fit your budget (more on that below).\nThere are a couple scenarios where an 84-month auto loan _might_ make sense:\n*   **If you invest the money you'll save**: If taking out a seven-year auto loan saves you $396 a month on your payments compared with a three-year loan (as in the example below), you could put that $396 into an investment whose rate of return outweighs the amount of interest you're paying on the loan. But will you really do that—for seven years? And if you have an extra $396 a month to invest, is keeping your car payment low really a concern?\n*   **If you plan to pay down other high interest debt**: If you have $10,000 worth of high interest credit card debt, taking out a seven-year car loan would give you more money to put toward your credit card bill each month. However, you'll have even more money to pay down your credit card debt if you don't buy the car at all or buy a much less costly one (that you could ideally pay for in cash). If you're already having trouble with credit, taking out a new loan probably isn't a wise move. END