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Affordability is at the top of a lot of people’s minds these days. It’s no secret that the new and used car markets are a major part of this conversation, with new records seemingly being set every quarter as it relates to average payments. Back in March 2025, we shared news that the average monthly new car payment had crested the $700 mark here in the United States. Well, according to some new reporting from JD Power, that figure has officially breached the $800-a-month mark as of March 2026. And as if that wasn’t bad enough, nearly one-in-five new car buyers are now paying $1000 or more a dozen times a year.
There are several factors that have played into the rise of average vehicle prices in recent years. The most obvious factor comes down to the price of new vehicles themselves, which have dramatically outpaced the general inflation rate in the United States since 2020. Those sky-high prices haven’t done much to bolster owner’s pocketbooks on the back end, however, with a large number of new car deals involving some form of negative equity transfer. Put simply, this is when you owe more on your loan than the vehicle is worth at the time of trade-in or sale. According to JD Power, 31.2 percent of trade-in deals currently involve negative equity; that's up from 26 percent last year, and 24 percent in 2024. Because that leftover loan amount is added into the value of your new loan, prices are, naturally, forced up.
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In order to combat this, average loan terms are getting longer. A 72-month loan was once seen as irresponsible, but they now make up some 40.5 percent of all sales. A whopping 13 percent of all new car sales last month featured 84-month loan terms. Of those seven-year loans, 34.1 percent were tied to truck purchases, despite the fact that trucks only accounted for 18.4 percent of total sales. Non-pickup truck or premium brand buyers accounted for only 9.3 percent of the loans totaling $1000 or more last month.
None of this is exciting news for car buyers. The push towards higher payments and longer loan terms will inevitably reach a boiling point; searching for vehicles that hang onto their value long-term could be a step to protect your investment, as would ensuring you aren’t overextending on a particular model. Both are easier said than done in today’s economy, however.
Born and raised in Metro Detroit, associate editor Lucas Bell has spent his entire life surrounded by the automotive industry. He may daily drive an aging Mustang, but his Porsche 944 and NB Miata both take up most of his free time.