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An 8-Year Car Loan Can Come Back To Haunt You

Natalie Pena (right) shows vehicles to Ruben Mendoza as he shops for vehicles at the Toyota of Deerfield dealership on October 2, 2014 in Deerfield Beach, Florida. (Joe Raedle/Getty Images)
Natalie Pena (right) shows vehicles to Ruben Mendoza as he shops for vehicles at the Toyota of Deerfield dealership on October 2, 2014 in Deerfield Beach, Florida. (Joe Raedle/Getty Images)

A traditional car loan is repaid in four years, but more Americans are stretching out their payments, according to Experian Automotive.

Michelle Singletary, who writes the “Color of Money” column for The Washington Post, says that when consumers choose to pay back a car loan in six to eight years, they’re taking a big risk: More money goes to interest payments. And if there’s an accident, the owner is still responsible for the balance of the loan.

Singletary joins Here & Now’s Peter O’Dowd with advice on financing your next automotive purchase.

Guest

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