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Martin Connolly knew he wanted to be a design draft technologist and calculated that one day he’d be making more than enough money to pay off his student debt.

But he needed a car to do that. And that led to another kind of debt: A car loan. That loan will now take him another seven years to pay off. When it’s finally done, the now 42-year-old will have paid $55,000 for a 2014 Nissan Altima that would have cost him $18,000 if he’d just bought it outright.

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Mr. Connolly is among a growing number of people who are finding themselves financing car purchases by rolling old debt — student loans, credit card bills, previous car loans — into new car debt, and taking advantage of a thriving business for financial institutions that have extended amortization periods for as long as 96 months.

The cycle of refinancing reinforces a debt treadmill cycle

Spurred by tantalizingly low interest rates, sweeteners like stretched out loan timelines, and increasingly confident consumers who worship their wheels, car debt has been growing at a phenomenal pace in recent years — faster than any segment of the credit market. Even more incredibly, car loans for more than the value of the vehicle have become commonplace. A debt-rating agency noted recently that in some cases consumers are borrowing up to 135% of the value of a vehicle. These “negative equity” loans, as they’re called, are the same sort that permeated the U.S. mortgage market before it collapsed in 2008.