Originally Posted by

**jschen**
Be very careful shopping payments! Imagine if I loaned you $100. I could let you pay back in 5 monthly payments of $20 or 30 monthly payments of $5. In the first case, you're getting an interest free loan. In the second case, it seems far more "affordable", but you're getting seriously screwed. It's very easy to get seriously screwed if you're simply looking at the monthly payment amount. To avoid this, make sure you're comparing loan terms that are identical save the interest rate. Same number of monthly payments, interest rates locked in for the duration of the loan in all cases, any loan processing fees appropriately factored in.

To minimize the payments, one simply prolongs the term of the loan. However, you pay dearly in doing so. You're paying interest for longer, and the interest rates tend to be higher. In an ideal financial situation, you'd buy your car in cash. But I cannot recommend taking out a car loan for longer than 4 years (48 months) unless you have a really good reason to do so. Preferably 2 or 3 years. There are plenty of places happy to loan you money that's to be repaid over as long as 6 years (!!!), charging you an exorbitant interest rate but managing to give you a marginally cheaper monthly payment than a 4 year loan. They make a lot of money off of you!