How does auto loan APRs work?

[Passions]

If I were to finance $15,000 from a new car, with %5.9, 60 months. But in actuality, I would pay it all off in a year or two, does it matter whether I pick 60 months or 24 months from the dealer?

My friend says to do the 24 month loan, since the APR will be lower and less interest.

But I think what does it matter 24 or 60 months, I will be paying it off in two years, so the interest will be the same.

???

 

[RossMAN]

http://www.bankrate.com/brm/calculators/autos.asp

 

[3chordcharlie]

Usually the dealer will give a lower rate if you choose a shorter loan term. If not then you only have to consider any penalties for early repayment, but it's still best to choose a payment schedule that matches your planned repayment schedule.

 

[Passions]

Originally posted by: RossMAN
http://www.bankrate.com/brm/calculators/autos.asp

:thumbsup:

 

[RossMAN]

If the APR % rates are the same for 24 and 60 months, I would choose the 60.