We now own our car outright, but we did have a loan to begin with, which we paid off within 3years, instead of the 7 the loan was for. I get the impression that some pp's think that people only take out loans to buy 40k+ cars. I wish lol! We did buy a brand new Holden Astra wagon back in 2007, but we bought it brand new with the thinking that it would have to last us 10+ years (and it was much less than 40k). We are now probably going to trade it in within 2 years, as it just won't fit a third car seat. We're hoping that we can pretty much do a straight swap because while I'm not at work, we can't afford a loan, so will have to go an older magna or commodore. But if we can't do a stright swap, then we probably end up getting a small loan to cover the difference. I'm also not ruling out getting a loan once I go back to work full time to buy a newer car.
For us, a car is a necessity. And other than having to fit 3 carseats in, we do alot of camping so the next car will have to be a decent size.

We also own DH's motorbike outright.