In NU, what should I know about maximum amortization length for car loans?

In Nunavut, as across most of Canada, maximum amortization lengths for car loans typically range from 60 to 96 months. While 72 and 84 months are very common, some lenders may offer up to 96 months, and occasionally even 108 or 120 months for specific high-value vehicles or strong credit profiles, though these are less frequent and carry higher risk. There are no specific federal or territorial regulations in Canada that cap the maximum amortization period for vehicle financing; rather, these terms are driven by market conditions, lender policies, and consumer demand.

For consumers, understanding amortization length is critical. Opting for a longer term, such as 84 or 96 months, significantly lowers your monthly payment, making a vehicle seem more affordable upfront, especially with current vehicle prices and interest rates in 2025. However, this convenience comes at a substantial cost: you will pay considerably more in total interest over the life of the loan. Furthermore, longer terms dramatically increase the risk of negative equity, where the outstanding loan balance exceeds the vehicle's market value, particularly given how quickly new vehicles depreciate. This can create financial challenges if you need to sell, trade in, or if the vehicle is written off before the loan is paid down sufficiently. Always confirm the exact terms with your chosen lender in Nunavut, considering local market factors that may influence vehicle pricing and financing options.