A 1-year (12-month) term and a 3-year (36-month) term sit at different points on the payment-versus-cost tradeoff. Tripling the repayment window roughly divides the monthly payment, but the total interest paid increases substantially — this comparison puts real numbers next to each other so you can see exactly what that tradeoff looks like for a specific amount.
1-Year Term (12 months)
- Higher monthly payment for the same amount
- Loan is fully paid off within a year
- Lower total interest paid overall
- Best if your budget can absorb the higher payment
3-Year Term (36 months)
- Monthly payment roughly a third of the 1-year option
- Three-year commitment before payoff
- Meaningfully more total interest paid
- Better if monthly cash flow is your top priority
At a Glance
| Aspect | 1-Year Term (12 months) | 3-Year Term (36 months) |
|---|---|---|
| Term length | 12 months | 36 months |
| Monthly payment (on $3,000) | ~$293/mo at 29.9% APR | ~$128/mo at 29.9% APR |
| Total repayable (on $3,000) | ~$3,516 | ~$4,608 |
| Best for | Smaller amounts, fast payoff | Larger amounts, lower payment priority |
The Verdict
For the same $3,000 loan, a 1-year term costs roughly $1,100 less in total interest than a 3-year term, but requires a monthly payment more than double the size. If your budget can handle the 1-year payment, it's the lower-cost choice — if not, the 3-year term's lower payment may be the more realistic option.