Confused on APR offered during car deal

[FSUGAPEACH]

Hi everyone,

I need some input. We purchased a 2016 Range Rover sport yesterday. When we went into the finance office we were offered 2 options by Chase. 9.5% for 72 months financing or 3.5% for 60 months? Of course we were focused on the lowest APR possible and we are ok with the payment but why such a vast difference between the 2? Really hoping we didn't make the wrong decision

[Anonymous]

Congratulations on your new Range Rover! 👍

[Shooting-For-800]

The car payment should have been almost the same with a 6% difference in APR.

If it was more than a $25 difference, something is wrong.

Due to age and brand of the car, it makes sense that the 72 month would have higher APR, 6% difference is quite a bit though.

If you can afford it, the lower APR is the right choice.

What was the payment difference?

[Kforce]

Common for many lending institutions to have higher rates as loan terms becomes longer.

From one of my CU's

[Kforce]

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@Shooting-For-800 wrote:

Due to age and brand of the car, it makes sense that the 72 month would have higher APR, 6% difference is quite a bit though

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You made the correct decision !

6% is a very very large difference for a one year longer loan.

Smart to not take that offer.

[AllZero]

Congratulations on your approval!

[FSUGAPEACH]

Payment was virtually the same (give or take $20 or so) so we went with the 5 year option for the lower APR. 

[FSUGAPEACH]

Thank you, I'm feeling much better about or decision! 

[blindambition]

Dealers and banks are offering longer terms. Consumers keeping cars longer. The longer the term, the higher the rate. 6% is high, but not uncommon. The longer the loan, higher risk of default. You chose right. Enjoy your Rover. 😊 

[Bankrupt2019]

The bank probably figured at any longer than the 60 months, you'd be spending all of your money on maintenance and not have any money left for them 🤷🏻‍♂️