Not very many people are excited about the idea of taking on a car loan, but for most drivers in America borrowing money to purchase a vehicle is a necessary part of our financial lives. Banks realize that car loans are a product that many people are interested in, and they make it pretty easy to obtain credit for the car of our dreams.

Perhaps a little too easy, in fact.

In recent years, banks and car dealerships have been offering increasingly long loan terms for vehicles. It used to be very rare to find a car loan that lasted longer than three years; then banks began allowing for four year terms. Now it’s very common for drivers to obtain five year loans, with many banks beginning to offer seven and eight year loan lengths.

This madness must stop!

While super-long car loans might seem attractive, they have two major downsides that not a lot of people consider when they’re scoping out a fresh set of wheels:

Longer loans are more costly overall. The longer your car loan lasts, the more you’ll pay in interest over time, making the purchase price of your car shoot up substantially.
The availability of longer car loans encourages people to buy more (or nicer) car than they can really afford or need. This tacks additional expense onto to their monthly budgets.

While the first drawback to a long auto loan might be obvious, it’s the second that’s the real killer, because while taking out a car loan doesn’t thrill many people, the car itself might. And if we know that we can spread our payments out over too long a time, we’ll likely purchase a vehicle that’s beyond what we can really afford. This leads people to get in over their heads – you’ve heard of being house poor? Well, a lot of people driving around today are car poor.

So what is a reasonable term for a car loan? A good rule of thumb to try to adhere to is that your car loan shouldn’t last longer than a president’s term in office. Four years is a sensible vehicle loan length.