New car loans are longer and for more money than ever, according to Experian Automotive.

New vehicle sales are humming along in 2015 led, in large measure, because of the appeal of full-size trucks, sport-utilities and luxury crossovers: all high-ticket purchases.

A bigger price tag often means a bigger loan. To keep the monthly payment down, borrowers are extending their loan terms to 67 months on average: the longest term ever for new cars, according to Experian Automotive.

The trend extends to used cars as well, which saw the average loan length extended to 62 months. Stretching out the loan to get a lower monthly outlay isn’t uncommon, but changing the parameters of loans would be of concern.

“While longer term loans are growing, they do not necessarily represent an ominous sign for the market,” said Melinda Zabritski, Experian’s senior director of automotive finance. “Most longer- term loans help consumers keep monthly payments manageable, while allowing them to purchase the vehicles they need without having to break the bank.

“However, it is critical for consumers to understand that if they take a long-term loan, they need to keep the car longer or could face negative equity should they choose to trade it in after only a few years.”

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The longer term is coming because of the growth in popularity of terms exceeding 72 months. The percentage of loans with terms of between 73 and 84 months reached a new high of 29.5% in the first quarter of 2015, up from 24.9% a year earlier.

Long-term used-vehicle loans also broke records, with loan terms of 73 to 84 months reaching 16% in the first quarter 2015, up from 12.94% — also the highest on record.

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As expected, the longer terms are coming with larger average amounts financed as well as higher payments. The average new vehicle loan was $28,711 in Q1 2015, compared to $27,612 in Q1 2014. The average monthly payment went from $474 in Q1 2014 to $488 in Q1 2015.

In other findings:

  • The average credit score for a new vehicle loan dropped slightly, going from 714 in Q1 2014 
to 713 in Q1 2015. The average used vehicle score moved slightly higher, from 641 in Q1 2014 to 643 in Q1 2015.
  • The average used vehicle loan was $18,213 in Q4 2015, up from $17,927 in Q4 2014.
  • The average interest rate for new vehicles was 4.71% in Q1 2015, up from 4.54% in Q1 2014. Similarly, the average interest rate for used vehicles increased from 9.01% in Q1 2014 to 9.17% in Q1 2015.

“Increases in vehicle financing are signs of a strong automotive market,” Zabritski said. “By gaining a deeper understanding of current financing trends, lenders are able to stay competitive and better meet the needs of the marketplace, while consumers can use the data to become more educated on the different vehicle financing options and make a more informed purchasing decision.”

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Additionally, leasing continued to increase in popularity during the quarter, jumping from 30.22% of all new vehicles financed in Q1 2014 to a record high of 31.46% in Q1 2015. During the same time period, the average monthly lease payment dropped to $405, down from $412 the previous year. It was a bit easier to lease a new vehicle with the average new vehicle lessee’s credit score coming in at 718 in Q1 2015, down from 721 the previous year.

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