"About a third of auto loans for new vehicles taken in the first half of 2019 had terms of longer than six years, according to credit-reporting firm Experian PLC. A decade ago, that number was less than 10%."
Availability of longer term loans don't just provide a flexible option for buyers, they may also entice buyers to purchase cars outside of their big-picture means by acquiring long term debt on depreciating assets.
Large spends on products and services with negative returns mirrors the root risk of students assuming large sums of college debt for degrees that may not result in lucrative careers. Both auto and student loans are thought to be at risk of "bubbles" that could have a serious impact on the American economy.
It will be interesting to see if the CFPB eventually views these longer car loans as "predatory," not dissimilar to some early 2000's mortgage practices. See subprime loans targeting those with poor credit history who may be more likely to take on extended terms.
Predatory lending is any lending practice that imposes unfair or abusive loan terms on a borrower. It is also any practice that convinces a borrower to accept unfair terms through deceptive, coercive, exploitative or unscrupulous actions for a loan that a borrower doesn't need, doesn't want or can't afford.
Car loans that are increasingly stretched out are a pronounced sign that some American middle class buyers can’t afford a middle-class lifestyle. Incomes have risen at a sluggish pace in the past decade, but car prices have grown rapidly. New technological and safety features, such as larger and more sophisticated multimedia displays, have made even the most basic cars more expensive. U.S. consumers have also veered toward pricier rides such as sport-utility vehicles that tend to dominate auto showrooms. The result is that consumers are seeking bigger loans than ever to purchase a car.