For independent dealers, the latest financing data points to two trends worth watching: buyers are stretching loan terms to manage payments, and credit access is widening at the lower end of the credit spectrum.
According to Experian’s State of the Automotive Finance Market Report: Q1 2026, the share of used vehicles financed with terms longer than six years climbed to 31.54%, up from 28.60% a year earlier. Used loans stretching beyond 85 months also edged up, reaching 1.40% from 1.32% the prior year. The average used-vehicle loan term now sits at 67.73 months.
The cost pressures behind those longer terms are familiar to anyone writing deals. The average used-vehicle loan amount rose $785 year-over-year to $27,070, while the average monthly payment grew from $523 to $531.
“Affordability continues to shape financing decisions across the automotive market,” said Melinda Zabritski, Experian’s head of automotive financial insights. “While shoppers continue to lean toward larger, more expensive vehicles, we’re seeing more consumers take advantage of longer-term loans to offset rising monthly costs.”
A second development may matter even more for the independent segment: subprime financing is expanding. Subprime borrowers made up 15.75% of total vehicle financing in Q1 2026, up from 14.40% a year ago. On the used side, the subprime share grew to 20.60% from 19.36%.
“There continues to be increased momentum within the subprime segment as financing options expand across the automotive finance market,” Zabritski said.
Refinancing is also giving some buyers room to breathe as rates ease. Consumers who refinanced in Q1 2026 trimmed an average of 2.2% off their interest rate, lowering the average refinanced rate to 8.05% from 10.29% and cutting monthly payments by an average of $81. Meanwhile, 30-day delinquencies ticked up to 2.00% from 1.95%, and 60-day delinquencies rose to 0.86% from 0.83% — a reminder that longer terms and broader credit access continue alongside elevated repayment strain.
