The Pros And Cons Of A Long-Term Car Loan In The Greater Toronto Area

Are you wondering if a Long-Term Car Loan Greater Toronto Area is the right choice? Many buyers in Mississauga and across Ontario want lower monthly payments but worry about paying more interest over time.

Our team at Erinwood Ford will break down the main benefits and drawbacks of extended auto loans to help you decide. Find out what matters most before your next car loan application!

Key Takeaways

• Long-term car loans can last up to 96 months, offering lower monthly payments. This helps buyers afford higher-priced vehicles like electric cars or new SUVs.

• Such loans may increase overall interest paid and risk of negative equity, where the car's value drops below what you owe.

• Erinwood Ford offers flexible financing options with transparent terms. They aim to match drivers with suitable cars and loans in Mississauga and the Greater Toronto Area.

• Deciding on a long-term loan depends on your budget, driving habits, and how long you plan to keep the vehicle. Assess total costs, including insurance, fuel, and maintenance, before choosing.

• The dealership provides a wide selection of new and used vehicles with competitive rates for qualified buyers. Options include low or $0 down payments based on credit approval.

  
  

What is a Long-Term Car Loan?

A long-term car loan lets you pay for your new or used car over a period longer than 60 months. In Canada, this could mean up to 96 months on some vehicles if you qualify. Many banks and lenders offer these extended vehicle financing options with fixed or variable interest rates for qualified buyers.

You can apply online or in person at Erinwood Ford in Mississauga.

Monthly payments are lower thanks to the longer repayment schedule. This can help customers manage their budgets better and afford higher-priced models, including electric vehicles.

Flexible payment plans are available based on your credit score and down-payment amount. For example, our team offers custom finance solutions on Canadian trim levels such as the F-150 XLT or Escape Titanium for up to eight years, depending on model year and credit history.

At Erinwood Ford, our team makes it easy for drivers in the Greater Toronto Area to find affordable long-term car loans that fit every lifestyle.

Pros of a Long-Term Car Loan in the Greater Toronto Area

A long-term car loan can help you manage your budget with smaller monthly payments. At Erinwood Ford, our team uses simple online applications and flexible payment plans to make driving a new or used vehicle across the Greater Toronto Area easier for qualified customers.

Lower monthly payments

Stretching your car financing up to 96 months keeps monthly payments low. The average payment for a new vehicle sits around $745 per month. For used vehicles, it drops to about $521.

Many drivers in Mississauga and the Greater Toronto Area see this as the best long-term auto financing option because it helps them handle other costs like gas, insurance, parking fees, and depreciation.

Rising prices on cars mean high price tags are common now. With lower monthly payments through Erinwood Ford’s flexible lending options and special annual percentage rate deals for qualified buyers, more people can afford higher-priced models or trims found in Canadian stock.

These manageable payments make it easier for most budgets to fit the total ownership costs of over $1,000 each month. Partial or early payoff is also allowed with no penalties on approved credit plans; that gives customers more control using their online car loan application or mobile banking tools such as debit card and cheque transfers.

Easier qualification process

Long-term vehicle payments mean lower monthly costs. This makes it easier for more drivers in the Greater Toronto Area to qualify for car loans at Erinwood Ford. People with many different credit scores, including those working to rebuild their credit, find approval simpler when the payments fit their budget.

Our team works with banks that provide options even if your financial report shows hardship or bankruptcy.

Many customers do not need a large down payment to start. Some banks may ask for one, but often it is not required for long loan terms on approved credit. We support first-time buyers and those new to auto financing every step of the way.

"We want you behind the wheel of your next car without extra roadblocks," says Dave Raymond, President of Erinwood Ford. Applying is fast and easy, so you can focus on choosing your favourite Canadian model from our wide selection in Mississauga, Ontario.

Ability to afford higher-priced vehicles

Payments spread over a longer period help more drivers afford higher-priced vehicles, like electric cars or new SUVs. Costs for these models have jumped in the last few years, but stretching financing up to 96 months on approved credit can make monthly payments much lower.

Many of our Erinwood Ford customers use this option to get behind the wheel of a premium F-150 Lariat or an Explorer Platinum, which might not fit their budget with shorter terms.

With support from online tools,  shoppers can finance new or used trucks, family SUVs, and even recreational vehicles more easily. Long-term loans also work well for those looking at electric models such as the Mustang Mach-E; upfront prices are high, but rebates and flexible payment plans help balance out costs across many months.

This flexibility connects directly with how you can manage other parts of your budget while still enjoying a top vehicle.

Next comes budgeting flexibility; see how adjusting term length can improve your financial plan.

Flexibility in budgeting

Moving beyond the chance to buy higher-priced vehicles, long-term car loans give you more control over your monthly budget. Our Erinwood Ford team will help customize payment schedules so they match how often you get paid or fit other needs.

Make lump sum payments at any time, without penalties, if you want to pay down your balance faster.

Erinwood Ford offers flexible solutions for qualified customers in Mississauga and the Greater Toronto Area. If life changes or financial hardship hits, payment extension options may be available with approved credit.

Your plan can also include extra options such as gap insurance or tire storage based on eligibility. We use tools like a pre-approval process to find what works for your specific budget and report it clearly on your credit report.

This way, owning a new electric vehicle or upgrading trims still fits within reach using fair rate of interest choices designed just for Canadian customers.

Cons of a Long-Term Car Loan in the Greater Toronto Area

Our team at Erinwood Ford wants you to know that a long-term car loan can increase the total amount you pay for your vehicle in Mississauga and across the GTA. This may affect your plans if you're hoping to use your credit card wisely or see driving as an investment for future upgrades.

Higher overall interest costs

Long-term car loans often come with higher interest rates. Over an 84-month loan, you pay a lot more in interest compared to a 36-month plan. On approved credit, these longer terms mean the bank or lender adds extra risk for themselves and charges more money over time.

For example, subprime auto loans can start at 12 percent and go up to over 28 percent, depending on your situation.

Some customers in Mississauga have paid as much as $8,000 or more in total interest during a long-term loan. Some lenders have shown rates from 4.99 percent all the way up to 28.99 percent based on each person's credit card history and investment profile; our Erinwood Ford team sees similar numbers here, too.

Special APR offers exist, but they only apply if you meet certain requirements set by lenders like Ford Credit Canada.

Choosing a longer term may lower payments, but increases what you owe.

At Erinwood Ford, we help customers understand every cost before signing any deal so they know exactly how their driver's licence and future investment choices will affect them down the road.

Risk of negative equity

Higher total interest costs go hand-in-hand with a bigger risk of negative equity for car buyers in Canada. Our team at Erinwood Ford sees this often with long-term auto loans. Negative equity happens when your vehicle’s value drops below the amount you still owe on your loan or financing contract.

New cars lose value fast, sometimes up to 25% in just the first year and about 15% every year after that. For example, if you purchase a new car for $31,300 at our Mississauga dealership, you could face around $3,700 in negative equity as soon as you drive away.

Subprime loans or choosing longer terms can make this worse for many shoppers needing quick transportation solutions.

Selling or trading a car while underwater may mean borrowing more money or facing extra fees. Including negative equity from your old vehicle into a new loan puts you further behind before you even start paying down the next one.

This can complicate insurance payouts if there is an accident resulting in a total loss of your vehicle before the loan is paid off—a key point every shopper should know before signing any agreement at Erinwood Ford.

Lengthy financial commitment

After discussing the risk of negative equity, we must also consider how a long-term car loan means making payments for up to 96 months, or eight years. Cars often lose value faster than you pay down your debt, and these longer terms can outlast your interest in the vehicle.

Many drivers like to swap cars every few years; this type of commitment makes that hard.

If personal or work needs change over time, being locked into a lengthy contract limits your options. Extended loans from Erinwood Ford may lead to higher total interest paid compared to shorter terms.

Repairs and maintenance also add up as vehicles age beyond their third year. Some banks might ask for larger down payments up front, depending on approved credit. Long commitments increase financial strain if you decide you want a different model or need flexibility due to changing life events around Mississauga and the Greater Toronto Area.

Potential difficulty in trading or selling the car

Long-term car loans can make it tough to sell or trade your vehicle before the loan ends. Cars lose value fast, often quicker than you pay off the balance. This creates negative equity.

You might owe more than what your vehicle is worth on the market in Mississauga or anywhere in the Greater Toronto Area.

If you want to upgrade at Erinwood Ford, trading a car with lots of debt left could roll those extra costs into your next agreement. Larger loan balances and higher interest charges may follow.

Early ending an auto finance contract comes with no penalty for qualified buyers, but negative equity still remains a common barrier, especially on 84-month terms or longer.

How to Decide if a Long-Term Car Loan is Right for You

Think about your money, the way you use your car, and the real costs before choosing a long-term car loan—learn more to make a smart choice with Erinwood Ford.

Consider your financial situation

Car-related costs can add up fast. The average monthly cost for a new car in Canada is $745. Used cars sit near $521 per month, while getting a vehicle through an agreement averages about $595 each month.

Annual expenses for a new car driven 24,140 kilometres reach almost $12,297.

Our team at Erinwood Ford recommends using less than 20% of your take-home pay on all auto expenses. Making even a small down payment helps lower interest and reduces risk of owing more than the car’s value later.

Our experts offer flexible options to help with credit rebuilding if needed, subject to terms and approval.

“Assess your budget carefully before committing to any long-term financial plan.”

Choosing the right option depends not just on price but also on how much you drive each year and how long you plan to keep the vehicle.

Evaluate your driving habits and car usage

Think about your daily routine. High-mileage drivers in the Greater Toronto Area may pay extra fees if they go with a rental agreement due to set distance limits. Car loans from Erinwood Ford, on approved credit, let you drive as far as needed without worry.

If you like to keep your car for many years and want to customize it, buying makes more sense than choosing a contract plan that has rules against modifications.

If you enjoy getting new vehicles often or predict changes in how much you'll drive, a long-term loan could limit your options later. Negative equity risk can make trading in early less practical for qualified customers who upgrade every few years.

Our team at Erinwood Ford will walk through your driving needs and advise if ownership or another option is better based on actual usage patterns across Mississauga and the GTA.

Assess the total cost of ownership

Our Erinwood Ford team urges you to check the complete cost of owning a car. The average owner in the Greater Toronto Area pays more than $1,000 per month for everything—this includes finance payments, full-coverage insurance (about $1,715 each year), fuel (around $2,235 yearly for 24,140 kilometres), and maintenance.

Depreciation alone will drop your car’s value by up to 20 percent in the first year; that is about $4,680 lost on a new vehicle in 2024.

Plan for extra expenses too. Annual license fees and taxes reach $815 on average. Some drivers pay more if they rent parking spaces or buy street permits. Many also need winter tires during cold months.

Use our financial calculator at Erinwood Ford to see your true costs before visiting our Mississauga dealership for J.D. Power award-winning service and advice from experienced automotive professionals.

Why Choose Erinwood Ford for Your Next Vehicle?

At Erinwood Ford, our team works hard to match every driver with the perfect car and financing plan. We make it easy for shoppers in Mississauga and the Greater Toronto Area to feel confident about their next purchase.

Wide selection of new and used vehicles

Our team at Erinwood Ford offers you a broad mix of new and pre-owned vehicles. Select from the newest 2025 Ford models, like the Bronco Sport and the F-150.

Our inventory also includes a lot of options, so there is something for every budget.

We refresh our stock with customer trade-ins or through auctions to ensure plenty of choices. This helps us offer strong service histories on many used vehicles and often means customers get higher value for their own trade-in.

You will also find a range of used Lincoln cars along with other premium brands in our showroom in Mississauga. Door Crasher Deals and special pricing make it easy to spot good deals fast.

New or used vehicle shoppers can explore both types of inventory—many available with 0 percent financing for qualified buyers who need a car loan option that fits their needs.

Now, let’s look at how we keep our financing process clear and tailored to your situation as you shop at Erinwood Ford.

Transparent financing options tailored to your needs

Erinwood Ford gives clear and simple options to fit your budget. Every price on our website is upfront, with no hidden costs for admin, registration, inspection, tires filled with nitrogen, or window etching.

We help car shoppers understand each part of the process. Our team walks you through every step before you sign anything.

Customers can ask about $0 down payment plans if they qualify. First-time buyers may access programs from Ford that lower starting payments and monthly costs for approved customers.

Competitive rates are available only after we check your credit; annual percentage rates depend on each buyer’s details. An $850 fee applies to all vehicle finance transactions at our dealership in Mississauga.

All used vehicles come with a full history report from CARFAX Canada for extra peace of mind. You will know the true cost before making any decision, and always have support when planning your budget at Erinwood Ford car dealership.

Next, see how our trusted service covers drivers throughout Mississauga and the Greater Toronto Area.

Trusted customer service in Mississauga and the Greater Toronto Area

You see how we offer clear financing options. Now, let’s talk about our strong customer service in Mississauga and the Greater Toronto Area. Our team has earned a high satisfaction score.

Customers praise us for friendly care and expert help every step of the way. Specific salespeople receive special mention for their warm approach.

We do not hide fees or costs; we check competitor prices daily so you get great value on every vehicle or car loan application. Our associates focus on making every visit easy and welcoming, whether you want to trade your current car or explore long-term payment plans for new Canadian models like Ford F-150s or Escapes.

Community support is key to our work here and helps build trust that lasts year after year with returning clients across the Greater Toronto Area.

Competitive rates and flexible long-term loan options

Erinwood Ford offers competitive financing rates for both new and used vehicles, including popular options like used Toyotas. Our team works with top banks and credit unions to secure favourable long-term loan terms for qualified customers.

Flexible repayment plans fit many budgets; this helps lower monthly payments, especially when choosing a pre-owned vehicle.

We tailor every car loan option based on your needs, making car ownership more affordable in Mississauga and the Greater Toronto Area. First-time buyers and customers with low credit scores may qualify for special finance programs upon approval for credit.

Explore Our Selection of New and Used Vehicles at Erinwood Ford

Choose from a full lineup of 2025 Ford models like Bronco, Escape, Expedition, Explorer, and F-150 in Mississauga. The lot includes both new and used vehicles. Every pre-owned car has a CARFAX Canada report for peace of mind.

Our team also brings in fresh inventory from customer trade-ins and local auctions.

Online browsing makes it easy to see Door Crasher Deals or check out used vehicle specials. Explore options with as low as 0% financing offers for qualified buyers on approved credit.

If you want to switch vehicles often, consider our flexible finance options tailored to your needs rather than a traditional long-term loan. All prices show Canadian dollars unless noted; information can change anytime.

Trade-in assessments benefit customers by offering fair values based on service history right here at our dealership serving the Greater Toronto Area.

Conclusion

Long-term car loans help many drivers in the Greater Toronto Area get into their next ride. They offer smaller monthly bills and flexible plans, but mean paying more overall and staying on the hook longer.

Our team at Erinwood Ford is ready to guide you through your choices with clear options and solid advice. Stop by in Mississauga to explore all our cars, SUVs, trucks, and financing plans for qualified buyers.

We want you to drive away knowing you made a smart choice for your budget and lifestyle.

FAQs

1. What are the main advantages of a long-term car loan in the Greater Toronto Area?

Long-term car loans offer lower monthly payments by spreading costs over an extended period—sometimes up to 96 months on approved credit. This makes it easier to fit higher-priced vehicles, like SUVs, trucks, and electric cars, into your budget. At Erinwood Ford, we also offer flexible payment plans and pre-approval options tailored to your needs.

2. What are the potential downsides of choosing a long-term car loan?

The biggest drawback is paying more interest over the life of the loan compared to shorter-term financing. Long terms may also increase the risk of negative equity—owing more than your vehicle is worth if you decide to sell or trade it early. Our Erinwood Ford team helps you understand the total cost before committing so you can make an informed decision.

3. How do I know if a long-term car loan is right for me?

Choosing the right loan depends on your financial situation, driving habits, and how long you plan to keep your vehicle. If you prefer lower monthly payments and plan to keep your car for many years, a long-term loan may work well. However, if you change vehicles frequently, you may want to consider a shorter-term loan or other financing options. Our experts at Erinwood Ford can walk you through the best choice for your budget.

4. Can I pay off my long-term car loan early without penalties?

Yes, Erinwood Ford works with lenders that allow partial or early loan payoffs on approved credit without extra fees. Making lump-sum payments can reduce your interest costs and help you pay off your vehicle faster. Our financing team can customize your loan to ensure it aligns with your financial goals.

5. Does Erinwood Ford offer special financing programs for long-term car loans?

Absolutely. We partner with top lenders like Ford Credit Canada and TD Auto Finance to secure competitive rates for qualified buyers. Whether you’re purchasing a new or pre-owned vehicle, we offer flexible loan terms, loyalty incentives, and low or $0 down payment options on approved credit. Our team will guide you through the entire process to make financing your next vehicle simple and stress-free.

Dave Raymond

President, Erinwood Ford & Direct Nissan

Dave Raymond has been a dedicated leader in the automotive industry since 2006, serving as the President of Erinwood Ford and Direct Nissan in Mississauga. With a wealth of experience and a customer-centric philosophy, Dave has consistently aimed to deliver the highest level of satisfaction to his customers.

His involvement in industry relations is extensive, including his roles as a former member of the Ford National Roundtable, President of the Toronto Dealers Association, and various leadership positions on advertising and action committees at the national and local levels.

Dave is deeply committed to social responsibility, actively participating in numerous projects that reflect his dedication to making a positive impact on society. His approach to business ethics focuses on continuous improvement, fostering a team ethos through community service, and creating an interactive and satisfying buying experience for customers.