Five times more likely to take out long-term auto loans than Americans, Canadians are buying more cars than ever – but taking longer to pay them off. Today, well over half of all new car loans are financed over seven years, or even longer. Well aware that the old industry standard of sixty months is vanishing,  Laneway Auto helps consumers cram fancier rides into tighter budgets. This shows how the old industry standard of sixty months is being stretched out by consumers determined to cram fancier rides into tighter budgets.

According to automotive expert Robert Karwel, who works for market research firm J.D. Power, “long-term financing has exploded in Canada.” The problem is that seven, eight, or even nine years are very long terms for paying off assets that are steadily depreciating in value while becoming more expensive in terms of upkeep and repairs.

Longer-Term Vehicle Financing in New Brunswick

The appeal of this drive now / pay later approach is obvious. With the average price of a new car topping $ 35,000, and used models not much lower (thanks to pandemic-strangled supply chains) buyers looking for the best auto loans in Halifax are opting for longer vehicle financing agreements. 

With a little help from our vehicle financing consultants, it is not hard to trim monthly instalments down to under $ 500 a month, even with only a modest down payment. Depending on the make, model, loan term, credit score, and even the time of year, interest rates on vehicle financing in New Brunswick may be as low as an irresistible zero percent.

Where to Find Long-Term Auto Loans in Nova Scotia

Canadians have many choices when looking for the # 1 place to shop for a used vehicle in Atlantic Canada, like Laneway Auto. Trustworthy sources include:

  • Online brokers are the answer for buyers with poor credit records, as simply filling in an application draws loan offers from multiple lenders willing to accept borrowers with less than stellar track records;
  • Online lenders have less stringent requirements, offering vehicle financing to drivers (even with poor credit scores) faster than more traditional institutions like credit unions and banks, although frequently at higher interest rates;
  • Dealerships are fast and convenient, shopping and financing your vehicle at the same place, with the chance of bargaining for extra features to sweeten the deal (but watch out for hidden fees); 
  • Credit unions offer competitive interest rates, but may require membership to access the services, with good to excellent credit requirements; 
  • Banks usually offer vehicle financing or personal auto loans at competitive interest rates, particularly to long-standing account-holders with excellent credit scores.

Car Financing Pitfalls to Avoid

So what’s the big problem with longer-term vehicle financing? The answer – negative equity – sounds complicated, but it’s really very simple. When the amount outstanding on an auto loan outstrips the resale value of the vehicle, this is known as being underwater, with your finances turned upside down. 

If you’re in this position, you are in good company – figures indicate that more than a third of Canadians trading in their cars still owe more than their wheels are worth. The usual way of dealing with this tricky issue is to roll this gap into the next vehicle financing, spreading the debt over longer repayment periods.

The upside here is that most auto loans in Nova Scotia are at fixed rates, protecting borrowers from future rate hikes, while ensuring that their monthly repayments remain stable. This contrasts with variable credit lines and mortgage rates that can wreak havoc with Canadian family budgets.


There’s a simple way to break out of this vicious negative equity cycle. A good start is to pick a ride that’s fully serviced and road-ready, like those on the Laneway Auto. Then simply keep your vehicle for as long as your loan, tamping down repair costs by regular maintenance and careful driving. For added reassurance, talk to our vehicle financing experts about the best ways to finance your next set of wheels.

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