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Estimated APR


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Estimated APR


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Estimated APR


Average Ratings

How to Get Best Auto Loan Interest Rates

Michael Jones

Auto Loan Expert

The auto loan industry is on the rise in the U.S. In 2015, Americans owed about $1 trillion in auto loans, according to CNN. This means that many of the big banks are clamoring to get business from car buyers who are looking to take advantage of the relatively low interest rates right now.

If you want to save a few $100 or even $1,000's on your next auto loan, and see why we can save you potentially days of time and frustration with our magical rate finder, read on. We share some critical info that makes our service uniquely helpful to you where no other site, bank, or lender, can!


Big WARNING #1 Beware of Misleading Loan Rates from Other Banks & Lenders!


Here's the short of it:  Our rates may look higher than the lender website, but that is because our rates are closer to what you will actually get. That's because most lender websites advertise rates based on the “perfect borrower”

Realize that all advertised rates on bank and lender websites only apply to customers in the highest credit score bracket (750+) or other factors which may not apply to you. That's because its often too difficult for them to show charts with all possible rates. But they are a bit sneaky is showing the best possible rate, instead of the average rate. There are few exceptions to this.

So if you are shopping on our site, and enter  your credit score to anything below “Best”  (meaning under 750), then you will see the monthly loan car payment and interest rates increase, because we are showing you more accurate rates than the typical bank/lender website.

So, what if you apply on your bank website? read the fine print (if they even have any), and you will see things like the following. This is copied straight from Wells Fargo's website:

5% of approved applicants qualified for this rate based on data from 07/01/2017 – 09/30/2017. Your actual APR will depend upon your credit transaction, your credit history and will be determined when a credit decision is made.”

What?! only 5%? That means your odds of getting the low rates they show is 1 in 20, so you might as well be playing a lottery. This is because you have to have an amazing credit score, get a loan at least a certain size, have enough of a deposit, and also be a customer; which is all fine for some people, but on average, most people are NOT going to get those rates. As soon as you complete your application with them, they may come back with much higher rates.

No models are perfect. But at least we take into consideration several factors that most lender websites wont, so while you may see higher rates on our site, its probably because the rate is much closer to reality.


Want Accurate Rates? Have at Least an Approximate Idea of Your Credit Score


Your credit score is the single most important factor in determining your loan rates. It can mean the difference between a 2% and a 20% interest rate. Now, you do not need to know exactly, but being within 50  or a 100 points is pretty valuable if you want to see accurate rates on our tool. Be sure to read the FAQ item on this page “Beware of Misleading Rates”

Don't know what your score is?  You can typically order a copy of your credit report for free once every 12 months from the government. It can take awhile, and requires a fair amount of work, so if you are just wanting to save some time, try to use your last known score.

How Can This Save Me Hours and Days of Loan Shopping?

Many lender websites will not tell you what the credit score cutoff is for approving a loan to you, meaning, a particular lender might only take customers with scores of 690+. So, maybe you take 30 minutes to apply with a lender, and the next day they call you, and say “your credit score is too low–we cant give you a loan”

We only show lenders when they are actually able to work with you as a borrower.


Protect Your Credit When Auto Loan Shopping

The good news is that when it comes to auto loans, most credit scoring systems simply ignore auto loan related inquiries on your credit score, and even combine multiple inquiries done in a short period of time as a single inquiry. So don't be afraid to shop for an auto loan the same way you would be concerned for things like home buying.

It's probably a good idea then to try to keep your loan hunt under two weeks.

How to Save the Most on your Loan: Get a Shorter Loan Term & Make a Larger Down Payment

This is pretty common sense if you have ever taken out a loan before, whether car, home, or even credit card.

Short loan length:

A shorter loan length (e.g. 3 years) is going to be far cheaper than a loan for 7 years. Either way, you can always pay down your loan faster than what you signed up for. Always a good way to save money.

Do not fall victim into getting sold on a longer loan term just because it lowers your monthly interest. Longer loan terms are to the advantage of the lenders because they get to collect interest payments for a longer period of time.

Also, remember that your car depreciates in value rather quickly. An extended financing period means that you could be stuck making loan payments on a car that is no longer in good condition to drive or is worth less than the outstanding balance of your loan, which could become problematic if you go to sell it later, and can sell it for less than the amount owed.

Down Payment Size:

Finally, remember that the larger down payment you make, the more you save on interest as well.

Save money. Minimize debt.

If My Poor Credit Score is Causing High Interest Rates, Are There Other Options for Me?


There are at least two options:

  1. Refinance later:   This is always an option, but may incur additional fees.
  2. Wait. Don't get a loan right now:  Waiting to improve your credit score before purchasing your car can be a smart move. Borrowing at high rates is something to be avoided if you can.  Additionally, if your credit score is really low, you may not qualify for financing at all from some of the major lenders. Even if they are not a lender you recognize by name, remember that you can always read the reviews on our site to see what other users have to say about their experience.


How to Refinance a Car Loan

Refinancing is a common option for car owners who currently have a high interest rate loan.

To see if you can get lower rates today, simply use our tool above.

Be aware that you will probably incur some upfront costs when you refinance, on top of the monthly loan rate. This is a given for any type of loan refinancing.

Variable Rate vs Fixed Rate: What is the Difference?



A fixed auto loan rate means that your monthly loan payments will be the same throughout your entire loan term because the interest rate never changes. This is a good option if you are able to lock in a reasonable rate right off the bat. Most auto loans use a fixed rate.


On the other hand, an auto loan with a variable rate means that the interest rate can fluctuate according to an index. Your monthly loan payments will go up or down depending on what is happening with the index, which is mostly dependent on the base rate set by the Federal Reserve Bank of the United States.

The benefit to a variable rate is that the rate tends to be lower than the fixed rate option. You need to be careful, however, because the interest rate can increase right away. If you have an extended loan term, this is even riskier because there are more opportunities that you will be stuck paying a higher interest rate for each month if interest rates go up over time.

On the other hand, if you expect national interest rates to drop over time, then variable rate may be a better option if your prediction is right. If you like knowing what you will pay every month for the life of the loan, and are not a big risk taker, then you should stick with fixed rates.


What is APR & How is it Calculated?

The APR is the mainly based on the interest rate of the loan, but it also includes any fees and other charges that you pay to get the loan. It is calculated over a year's time, which is why it is called “annual” percentage rate. This is good for you because it gives you a much more precise look at how much the loan will really cost you (after fees).

If your loan's APR is, say, 12%, then you simply divide by 12 months to see that your monthly interest is 1$.

If your loan is for $5,000, then 1% would mean interest is 550/month.  We got that by multiplying 1$ x 5000.

Best Auto Loan Interest Rates


Like home mortgages, car loans are a critical part of the global economy. Without auto financing, many consumers wouldn’t be able to afford a vehicle. The number of car loans in the United States have skyrocketed since the early 2000’s. As with any type of debt, your credit score one of the major factors that determines how much you pay in the long-run and if you even quality for a loan in the first place. The cost of auto debt is wholly in part determined by your credit. The annual percentage rate (APR) is based on both current economic factors and your financial background. Since many people are unaware of how auto loans work and what the associated costs are, we’ve put together an extensive list of questions to cover everything you need to know.

Your Credit Score and APR

The APR you get on an auto loan is heavily determined by your credit score. Someone with a 550-credit score could end up paying 10% more than someone with a credit score of 710. As you can imagine, this could end up being several thousands of dollars more throughout the life of the loan. While a credit score of 713 is considered to be a “good” score, you’re not out of the running if you have a score that is lower. The below questions will give you an indication if you’re score meets the mark or not.

What is a good interest rate on a car loan?

A good interest rate on a car loan would be one that falls between 3 to 4%. To get an interest rate in this range, you would need a credit score in the “good” category.

What are current auto loan rates?

According to market data, the current rate for a 60-month new car loan is 4.93%, 4.87% for 48 months, and 5.57% for a 36-month used car loan. The exact rate you pay will vary by your location and credit score.

What is the average interest rate on a car loan with a 700 credit score?

The average auto loan interest rate with a 700-credit score is 4.68% for a new vehicle. Used cars have a slightly higher interest rate because the resale value is harder to predict.

Can I get a car loan with a 670 credit score?

Yes, you can get a car loan with a 670-credit score. Since this is considered to be a “fair” credit score, you could secure an interest rate of about 7% or less.

Is 692 a good credit score?

No, technically this credit score still falls under the “fair” category. With that said, you would have no problem getting a car loan with a credit score of 692.

What car loan rate can you expect with a 710-credit score?

Someone with a 710-credit score can expect to pay an APR of 4.68%. This is considered to be a “good” credit score and you should aim for rates in line with the current market average.

What would my % rate be for a car loan with no credit history?

According to industry professionals, the APR for someone with no credit history would likely range from 10 to 20%, even up to 30% in some cases.

What fico score is needed to get the best exceptional auto loan rate in 2018?

Most lenders use the FICO Auto Score 8 to determine your auto loan rate. This is an altered version of your credit score that is exclusively for auto lenders.

What interest rate would I qualify for auto loan with 673 credit score?

You would quality for an interest rate between 6 to 8% with a credit score of 673. Keep in mind that with this credit score, you might be required to put some money down.

What is a good credit score to get a car loan?

A good credit score to get a car loan is at least 660. Once you start to drop below this mark, the APR starts to double as you enter the subprime and nonprime categories.

Can I get a car loan with a credit score of 500?

Yes, you can get a car loan with a credit score of 500. The bad news is you’ll end up paying an APR rate of 15% or above. To save money on interest, you should make a sizeable down payment.

What interest rate can I get with a 550 credit score?

With a credit score of 550, you’d likely get an interest rate of 15% or above. If your credit score drops below 550, you might even have a hard time finding someone to finance your car for you.

How to determine interest rate on car loan?

The best way to determine your interest rate on a car loan is to use an online auto loan interest rate calculator. This considers your credit score, location, and the loan amount.

How does credit score affect auto loan interest rate?

Your credit score directly affects your auto loan interest rate because it represents the likelihood that you’ll pay back the loan. Someone with a poor credit score may have an APR 10% higher than someone with a good score.


The Role of APR and How to Lower it

Now that you know credit affects a loan’s APR, it’s time to understand the role of APR on the loan itself and how to lower it. There are many smart tips to lower your APR (even if you already have a loan). For example, refinancing is a common method used to grab a lower interest rate and save money in the long-term. Whether you have a loan or already or are in the market for one, these questions will guide you.

Which bank has 0 interest rate on car loan?

Banks don’t normally offer loans with 0% interest rates, even if you have exceptional credit. Car dealerships, on the other hand, sometimes offer dealer-backed zero APR financing to help boost sales.

How much money do I save in half point interest rate on car loan?

The only way to truly how much you will save is to first calculate the cost of the half-point reduction and then calculate the long-term cost you’ll pay with the new APR. Compare this new calculation to what you’re paying currently.

How do I get my auto loan interest rate down if I am active duty military?

You can lower your auto loan interest rate by refinancing your current loan with Navy Federal Credit Union (NFCU). NFCU offers competitive interest rates exclusively to military personnel.

How to know what interest rate to refinance an auto loan?

The goal of refinancing an auto loan is to obtain a lower interest rate with the new loan. You should aim for an APR at least 1-2% lower than your current one, at the minimum.

How to negotiate a better interest rate on a car loan?

The first step to negotiate a better interest rate is to make sure your credit is in good standing. Clean all the errors you can find. Compare multiple quotes online and then mention competitor’s rates when you’re negotiating.

What is the lowest interest rate on a used car loan?

The lowest interest rate you could find on a used car loan would be about 3%. Securing an APR this low would require you to have a credit score in the upper 700’s or low 800’s.

What is the highest interest rate on a car loan by law?

Each state establishes a general usury rate that caps interest rates. The bad news is, many of these statues only apply to loans under a certain dollar amount. In Kentucky, for example, there are no limits on loans over $15,000.

How to lower interest rate on car loan?

Before applying for a loan, you should review your credit report and check for errors that could be hurting your score. If you already have a loan, refinancing is another possible way to lower your APR.

How to calculate interest rate on a car loan?

To calculate the interest rate, you need to know the amount of interest you’re paying and the loan principal. Take your finance charges (interest) divided by the current balance (principal) and then multiply that by 12 and then 100. You might find a car loan payment calculator handy for this.

What is the difference between APR and interest rate on a car loan?

The APR is more general than the interest rate. In theory, the APR includes fees and other expenses. The interest rate is merely a component of the APR that determines your long-term cost of borrowing.

What is a fair interest rate on a car loan?

Any APR under 20% would be considered “fair.” While it might sound high, this rate would be for consumers with a subprime credit score (500 or less). With average credit, a fair rate would be around 7%.

What is a fixed rate auto loan?

A fixed rate auto loan is a loan that has the same interest rate over the life of the loan. The interest does not fluctuate with market conditions and your payments will remain the same.

What is the prime interest rate for a car loan?

Prime interests rates are only available to customers with the highest interest rates. When it comes to prime rates for car loans, the average is anywhere between 2 and 3%.


Current Market Interest Rates and Key Factors that Affect APR

As you may know, the current interest rate is always fluctuating. Think of it like the stock market. Economic factors and happening across the globe can have a huge impact on the interest rates. Depending on the type of loan you take out, your interest rate may or may not change as the federal rate changes. Along with the federal interest rate, there are lot of the components to the constantly changing APR and competitive rates. Finding a lower monthly payment can require real effort. 

What are current used car loan rates?

Used car loan rates have historically always been higher than loans for new cars. With a good credit score, rates start as low as 4%. Those with a poor credit score can expect to pay well over 10%.

What car loan rate based on credit score?

The annual percentage rate (APR) is based off your credit score. Lenders use your FICO score to determine the risk when issuing you a loan and your likelihood to pay it back.

What is good interest rate on an 84-month auto loan?

A good interest rate on an 84-month auto loan is 5%. Since the term length is longer than most other car loans, you can handle an interest rate slightly higher (~1%) than a short-term loan due to the already low monthly payments.

When feds raise interest rates, does it affect car loan rates?

Yes, when feds raise the interest rates lending becomes more expensive for everyone. An increase in the interest rate won’t affect you if you have a fixed auto loan.

What auto loan rate can I expect after ch.13?

The auto loan rate will depend on how well you reestablish your credit after filing for chapter 13 bankruptcy. If your credit score took a big hit after filing chapter 13 and is now below 600, you can expect to pay 15% or more.

How to figure what interest rate you will pay over the length of an auto loan?

You first need to determine if you have a fixed loan or a variable loan. Fixed loans have the same interest rate over the life of the loan. If you have a variable loan, the prime lending rate will give you a good indication of how the APR can change.

What is the highest interest rate on a car loan by law?

While same states do, most states don’t have a statue the defines the highest auto loan interest rate permitted by law. Regardless, the financial institution must disclose the interest rate to comply with the Federal Truth in Lending Act.

What is an APR rate for a car?

APR stands for annual percentage rate and is an important component of car loans. The APR includes the interest rate you pay per year plus the additional fees associated with the line of credit.

What is the interest rate on a used car loan?

The interest rate on a used car loan depends on your credit score. Consumers with a credit score over 780 only pay an average of 3.68%. On the other hand, those with a credit score less than 660 may pay anywhere between 10 and 20%.

How to estimate car loan interest rate?

The most straightforward way to estimate your car loan interest rate is to apply for quotes. Quotes will give you the most accurate representation of the APR you’ll pay on an auto loan.

What does comparison rate mean car loan?

A comparison rate is a tool used to compare multiple car loans at varying loan terms and interest rates. Some comparison rate tools even use the lending party as a determining factor.

How to calculate effective interest rate for car loan?

The easiest way to calculate the effective interest rate for a car loan is to use an online calculator. You’ll need to know the nominal rate, number of periods, and compounding time (i.e. one year = 12).

Financing a Car with An Auto Loan

Unless you’re buying an early 2000’s vehicle, chances are you’re going to end up financing your car with an auto loan. You can finance a car at many different places – a bank, credit union, or through the car dealership. As with any type of loan, it’s best to shop around and compare different interest rates before taking the leap. We’ve compiled the below questions to give you a glance at the ins and outs of financing a car with an auto loan.

Which bank has the best auto loan rates?

Bank of America is known for having some of the lowest auto loan rates. Depending on your credit score, you can get a new auto loan for as little as 3.44% and a used one for 4.29% APR.

How do I get the best auto loan rate?

You can get the best auto loan rate by using a comparison tool that lets you view multiple quotes at once. Don’t go with a loan just because it was offered by the dealership – take time to shop around.

What is a bad interest rate on a car loan?

A bad interest rate on a car loan depends on your credit score. If you have excellent credit, an APR over 5% would be bad. On the other hand, someone with subprime credit (500-600) should not pay over 18%.

After approval, how long to receive rates on car loan?

After being approved for an auto loan, you typically find out the interest rate right away. In fact, there are some lenders that instantly approve you and subsequently inform you of the rates.

What is a good APR rate for a car loan?

A desirable APR rate for a car loan is under 4%. To obtain this interest rate, you would need a credit score between 781-850. Consumers with credit score in this range can also get a used car loan for under 4%.

Can you pay off a car loan early?

Yes, you can pay off a car loan early. In fact, if you pay off a car loan before the loan term ends, you will save money on interest. When you pay of the loan early, more of the money goes to the principal.

Which credit union has the best auto loan rate?

One of the financial institutions with the best auto loan rates is Consumer Credit Union. They offer loans for as little 2.24% and will finance 100% of the purchase price.

How much should I put down on car?

While you don’t have to make a down payment on a car, it’s suggested that you put down 10% on a used car and 20% on a new one. The initial down payment helps you save money on interest.

How much is a down payment on a 10000 car?

That depends on whether it’s a new or used car. Since $10,000 isn’t likely to get you a new car in today’s market, the suggest down payment for a used car at this price is $1,000.

What is the minimum amount you can finance a car for?

Each lender has the authority to set their own minimum financing amounts. On average, most lenders won’t issue a loan for anything under $5,000. However, some make exceptions depending on your credit score and down payment.

What is the average interest rate for a car loan with bad credit?

Anyone with a “very bad” credit score that falls in the 300-599 range would pay an average interest rate of just over 15%. Those with a credit score below 550 might not even qualify for financing.

What interest rate do I qualify for auto loan?

Since interest rates vary on if the car is new or used and your credit score, the only way to know what interest you apply for is to apply for a free quote.

How to determine interest rate on car loan?

The best way to determine your interest rate on a car loan is to use an online auto loan interest rate calculator. This considers your credit score, location, and the loan amount.

What is the average car loan interest rate with good credit?

The average car loan interest rate with good credit is 3.71% for a 36-month loan, 3.81% for 48 months, 3.93% for 60 months, and 3.78% for a 72-month loan.

What are loan rates offered by car dealers?

Dealers go through banks to provide financing and therefore offers rates comparable to banks. Since the dealers act as the middleman, they sometimes have higher APRs than banks.

What is the typical interest rate on a 72-month car loan?

The average interest rate on a 72-month loan is roughly 5% for those with good credit scores. If you have subprime credit, you’ll likely pay a higher interest rate.