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Crash Course:
- Autopay currently has the best new car loan rates at 2.99% while Consumers Credit Union has the lowest used car loan APR at 5.79%.
- Shorter financing terms of 24 to 36 months generally come with the lowest interest rates.
- Your credit score is the single biggest factor in the auto loan rates you receive.
Compare Auto Loan Rates
Compare which options fit your budget, credit score, and term length below.
- All
- Used Car Loan
- Refinance Loan
- New Car Loan
- All
- 36 to 72 months
- 48 to 84 months
- 24 to 84 months
- All
- 500
- 510
- 550
- 575
Used Car Loan
Cred Score
Rate Term
APR*
- Great for customers with limited/no credit
- Offers special military rates
- A+ BBB rating
Refinance Loan
Cred Score
Rate Term
APR*
- Average monthly savings of $150
- Work with personal loan concierge to compare options
- A+ BBB Rating
New Car Loan
- Rates as low as 0% on select cars, trucks and SUVs
- Free Online Quotes – Get Your CarsDirect Target Price Today
- Local dealers compete to provide the best rates for new vehicles
New Car Loan
Cred Score
Rate Term
APR*
- Below-average credit scores
- Great interest rates
- Smooth and easy online experience
Refinance Loan
Cred Score
Rate Term
APR*
- No application fee
- Lending platform that partners with banks
- Approval and loan terms based on many variables, including education and employment
Getting the best auto loan rates could save you hundreds or even thousands of dollars over the life of the loan. To help you find the best car financing options, our experts compiled their research into the following guide to auto loans.
We’ll take a look at the industry’s top car lenders, outlining the rates and services they offer for easy comparison. You’ll also get tips for getting the best auto loan rates and learn how to make sound financial choices about car financing.
Who Has the Best Auto Loan Rates?
Based on our extensive research of auto loan lenders, AUTOPAY currently advertises the best auto loan rates overall at 2.99%. PenFed Credit Union and Chase also generally offer some of the lowest car loan rates on the market. Note that borrowers in need of bad credit car loans may find lower APRs from specialty lenders.
Interest rates change frequently and have been increasing as of late. While the information in this article is accurate as of publication, interest rates may have changed since. The easiest way to find the best auto loan rate estimates is by getting prequalified by multiple lenders.
Compare Auto Loan Rates
The rate table below compares the lenders with the lowest interest rates for car financing. We’ve broken down each provider’s lowest APR, auto loan terms, and credit requirements:
| Auto Loan Lender | Minimum APR | Loan Terms | Loan Amounts | Minimum Credit Score |
|---|---|---|---|---|
| AUTOPAY | 2.99% | 24 to 96 months | $2,500 to $100,000 | 560 |
| PenFed Credit Union | 5.19% | 36 to 84 months | $500 to $150,000 | 650 |
| Chase | 6.34% | 12 to 84 months | $4,000+ | None |
| Consumers Credit Union | 5.54% | Up to 84 months | No minimum or maxiumum | 620 |
Since interest rates are always changing, the numbers above are likely to fluctuate over time. Also keep in mind that minimum APRs vary based on credit score, chosen loan term, and income among other factors.
Best Auto Loan Lenders
Our car loan experts named AUTOPAY as the best overall provider due to its reasonable rates and convenient marketplace model. However, all four of our top picks offer competitive APRs and have generous eligibility requirements for financing a car.
#1 AUTOPAY: Best Overall Loan
New car loan starting APR: 2.99%
Used car loan starting APR: Varies
Refinance loan starting APR: Varies
Minimum credit score: 560
Minimum loan amount: $2,500
AUTOPAY is a car financing aggregator – also known as a broker – that finds loan offers that are a good match for borrowers. The lending partner offers its lowest rates to good credit borrowers, but it’s also available to those with poor credit scores.
In addition to purchase loans, borrowers can get lease buyout loans, auto refinance loans, and cash-out refinancing from AUTOPAY. Since the company works with various car lenders to find reasonable rates, you can expect to get consistently competitive offers.
AUTOPAY holds an A+ rating and accreditation from the BBB. The broker also earns an impressive 4.8 out of 5.0 stars from over 500 customer reviews on Trustpilot.
| AUTOPAY Pros | AUTOPAY Cons |
|---|---|
| Competitive introductory APRs | Loan approval can take up to two days |
| Low minimum credit score requirement | Minimum APR is hard to qualify for |
| Strong customer reviews |
#2 PenFed Credit Union: Best Credit Union Loan
New car loan starting APR: 5.19%
Used car loan starting APR: 6.04%
Refinance loan starting APR: 5.19%
Minimum credit score: 650
Minimum loan amount: $500
Credit unions are becoming a popular choice for the best auto loan rates, and PenFed is one of the providers that’s leading the way. Those who pick PenFed Credit Union typically receive low APRs and can take out car loans for almost any reasonable amount.
Car buyers have the option to finance private party auto sales through PenFed, something that few other lenders allow. Those who use PenFed Credit Union can also get discounted interest rates by using its specialized car buying service.
You must be a member of PenFed Credit Union to qualify for a loan, but anyone can join by making a $5 deposit. When you apply for an auto loan, the company refunds this amount.
PenFed Credit Union Pros and Cons
| PenFed Credit Union Pros | PenFed Credit Union Cons |
|---|---|
| Some of the lowest APRs on the market | Requires membership to become eligible |
| Offers loans as small as $500 | Car buying service needed for lowest APRs |
| Excellent customer service scores | Medium or strong credit needed for approval |
#3 Chase: Best Big Bank Loan
New car loan starting APR: 6.34%
Used car loan starting APR: 7.24%
Refinance loan starting APR: Not applicable
Minimum credit score: None
Minimum loan amount: $4,000
Drivers often find low interest rates from Chase, a national bank that also serves as an auto lender. The company has no minimum credit score, making it one of the options that’s most likely to accept those with fair or poor credit.
One downside to Chase auto loans is that car buyers must purchase new or used vehicles from a dealership that participates in the bank’s network. While there are plenty of qualifying dealers across the U.S., it still limits your options compared to elsewhere.
While Chase has some of the best auto loan rates for new and used cars, it doesn’t provide auto refinancing. It’s best to look elsewhere if you’re in need of refinancing services or are interested in a lease buyout loan.
Chase Auto Loan Pros and Cons
| Chase Auto Loan Pros | Chase Auto Loan Cons |
|---|---|
| Strong financial backing | Forced to buy from a dealership network |
| No minimum credit score limit | Doesn’t offer auto refinancing |
| Excellent industry reputation | Mixed customer service scores |
#4 Consumers Credit Union: Excellent Credit Union Loan
New car loan starting APR: 5.54%
Used car loan starting APR: 5.79%
Refinance loan starting APR: 5.54%
Minimum credit score: 620
Minimum loan amount: No limit
Consumers Credit Union is another credit union worth considering in your search for the best car loan rates. While services are only available to members, Consumers Credit Union accepts anyone who pays a $5 fee and keeps at least $5 in a savings account.
Through its partnership with TrueCar, Consumers Credit Union provides a search tool to help borrowers find vehicles that fit their needs and budget. Those who set up autopay for their car loan receive 0.25% off of whatever their original APR was set to be.
Consumers Credit Union currently holds an A+ rating and accreditation from the BBB. Purchase loans and refinance auto loans are both available from the credit union.
Consumers Credit Union Pros and Cons
| Consumers Credit Union Pros | Consumers Credit Union Cons |
|---|---|
| Starting APRs are generally low | Lackluster customer service scores |
| Flexible loan terms and limits | Must become a member to get a loan |
| Generous autopay discount |
What Is a Good Auto Loan Interest Rate?
A good car loan rate currently is any APR that falls below 5%. However, to get the best gauge of a good auto loan rate, you should see if it is lower than lender averages. In the table below, you’ll find the average interest rates for new and used vehicles from both banks and credit unions, based on Experian’s Q4 data set.
| Loan Type | Average APR From Credit Unions | Average APR From Banks |
|---|---|---|
| New car loan | 5.49% | 7.00% |
| Used car loan | 7.03% | 9.34% |
What Are Current Auto Loan Rates?
Auto financing rates have risen slightly over the last year. The current average auto loan interest rate is 6.63% for new car purchases and 11.38% for used vehicle purchases according to the Experian State of the Automotive Finance Market Q2 2023 report.
However, your ability to find the best auto loan rates is dependent on a few key variables, with your credit score being the most impactful. In the table below, you’ll see how large of an impact your credit score plays in the car financing rate you’ll receive:
| Credit Score | New Car Loan Rates | Used Car Loan Rates |
|---|---|---|
| 781 to 850 | 5.07% | 7.09% |
| 661 to 780 | 6.44% | 9.06% |
| 601 to 660 | 8.99% | 13.49% |
| 501 to 600 | 11.72% | 18.49% |
| 300 to 500 | 14.18% | 21.38% |
What Affects Auto Loan Interest Rates?
There are many factors to keep in mind when searching for the best auto loan rates. The APRs you’ll receive for a car loan are affected by a variety of factors, including:
- Credit score: Borrowers with poor credit scores face higher interest rates than those with good credit. Your score is the biggest factor in the rates you receive from auto lenders.
- Loan term: Shorter terms typically come with lower interest rates because they’re less risky to the auto lender. Consider making higher monthly car payments to get a shorter-term loan with a lower overall cost.
- Credit report: Lenders look at your entire credit report, so two people with the exact same credit score could still receive different rates.
- Income: Car lenders often have minimum income requirements for borrowers to qualify for and secure the best auto loan rates.
- Down payment: A higher down payment reduces the total amount of the loan and lowers your loan-to-value (LTV) ratio. Because of this, making a larger down payment could net you a lower interest rate.
- Discounts: Many auto lenders offer rate discounts for setting up automatic payments on your account. You may be able to find other discounts, such as one for using a partner’s car buying service.
- Negotiation: If you get multiple offers, you may be able to use them to negotiate interest rates between car lenders.
How To Get the Best Auto Loan Rates
There are a few different ways to save money and find the best auto loan rates. Below, we’ll outline a few methods to reduce your APR for a new car, a used vehicle, or a lease buyout.
Raise Your Credit Score
Improving your credit score isn’t easy or fast, but it’s the best path toward lower interest rates. By meeting all obligations on time, paying down debts, and avoiding bankruptcy, you can eventually raise your score and put yourself in a better financial situation.
Find a Co-Signer
If your credit score isn’t the best, you can check if a family member or friend with a better score can co-sign on the loan. You may be able to use their good credit score as the launch pad to getting the best auto loan rates.
However, many financial advisors strongly discourage this practice. Missing even one loan payment can hurt your co-signer’s credit rating and put a strain on personal relationships.
Buy Used Rather Than New
If saving money is your overall goal, look into purchasing a used or certified pre-owned car instead of a new one. A model that’s two or three years old will be significantly cheaper than a brand-new car. Even if your APR is slightly higher, you’ll still save money this way.
Make a Larger Down Payment
You can also make a larger down payment on the new car to reduce your APR. More money upfront reduces the risk to lenders, leading to lower rates. If you can afford to put more money down for a vehicle, it can be a good option for getting the best auto loan rates.
Best Auto Loan Rate: Conclusion
You can find the best auto loan rates by comparing APRs from various financial institutions, credit unions, online lenders, and dealers. We encourage you to get prequalification from multiple lenders to determine what a competitive rate looks like for you. While these numbers are just rate estimates, prequalification counts as a soft credit pull and won’t affect your credit.
When you’re getting serious about purchasing a car or refinancing an auto loan, it’s time to consider preapproval. This will affect your credit score, but almost guarantees that you’ll receive a loan from the lender if approved. All inquiries should count as one hard credit pull as long as you apply for preapproval from multiple lenders in a short window of time.
Find The Best Auto Loan Rates and Lenders
As mentioned, one of the simplest ways to find the best auto loan rates is by shopping around. Do this before stepping into the room with a loan officer at a car dealership. While dealers sometimes pressure car buyers to take out auto loans and purchase warranties, there’s no need to commit. Remember that you can get any number of prequalification offers as long as they only require soft credit checks.
When you’re ready to move forward with an offer, you can get auto loan preapproval and go through the full loan application process for an option with low rates. Below are a few solid options that can help you start to compare providers with the best auto loan rates.
Compare Auto Loan Rates
Compare which options fit your budget, credit score, and term length below.
- All
- Used Car Loan
- Refinance Loan
- New Car Loan
- All
- 36 to 72 months
- 48 to 84 months
- 24 to 84 months
- All
- 500
- 510
- 550
- 575
Used Car Loan
Cred Score
Rate Term
APR*
- Great for customers with limited/no credit
- Offers special military rates
- A+ BBB rating
Refinance Loan
Cred Score
Rate Term
APR*
- Average monthly savings of $150
- Work with personal loan concierge to compare options
- A+ BBB Rating
New Car Loan
- Rates as low as 0% on select cars, trucks and SUVs
- Free Online Quotes – Get Your CarsDirect Target Price Today
- Local dealers compete to provide the best rates for new vehicles
New Car Loan
Cred Score
Rate Term
APR*
- Below-average credit scores
- Great interest rates
- Smooth and easy online experience
Refinance Loan
Cred Score
Rate Term
APR*
- No application fee
- Lending platform that partners with banks
- Approval and loan terms based on many variables, including education and employment
Best Car Loan Rates: FAQ
Below are some frequently asked questions about the best auto loan rates:
Who has the best auto loan rates?
Currently, AUTOPAY has the best auto loan rates for new and used cars. You’ll also find competitive offers from PenFed Credit Union, Chase, and Consumers Credit Union. Some drivers find reasonable rates from myAutoloan, Lightstream, Carvana, and the Navy Federal Credit Union.
What is a good interest rate for a car right now?
An excellent APR for a car right now is anything less than 5%. Remember that the best auto loan rates are typically for new cars, so you may receive a higher number if you’re looking to finance a used model.
Which bank has the best auto loan rates?
At this time, Chase has the lowest car loan rates starting at 6.34%. You can get competitive rates from the bank if you purchase a new car and have excellent credit. Other banks that offer auto loans include Capital One, Wells Fargo, and Bank of America.
What is a good interest rate for a 72-month car loan?
A 5% starting interest rate is currently good for a 72-month car loan. It’s critical that drivers looking for six-year car loans get reasonable interest rates or they could end up underwater on their loans. After all, the lower monthly payments on a long-term loan still add up over time.
What are the lowest auto loan rates?
Currently, the best auto loan rates for new vehicles are around 3%. Lenders compete with one another by offering low-interest rates to those they mark as dependable borrowers.
How can I get a low interest rate on a car?
You can get a low interest rate on a car by finding a co-signer, boosting your credit score by paying off credit card debt, or making a larger down payment at the start.
Is 2.9% APR a good rate?
Yes, 2.9% APR is an extremely good rate in 2023. Few drivers will receive interest rates this low unless they have excellent credit scores.
Can I get a 0% interest rate on a vehicle?
Yes, but these offerings are typically provided only at dealerships and are given exclusively to those with excellent credit scores.
Why are car loan interest rates so high?
Interest rates are currently high due to monetary policies put in place by the Federal Reserve to decrease high inflation. In the U.S., the standard federal interest rate has been raised significantly over the past year, causing the overall cost of borrowing money to soar.
Is it smart to pay off a car loan early?
Yes, it can be a smart move to pay off a car loan early so that you can save on interest. Check that there aren’t prepayment penalties included in your loan, though, or they could wipe away any potential savings.
Our Methodology
Our expert review team takes satisfaction in providing accurate and unbiased information. We identified the following rating categories based on consumer survey data and conducted extensive research to formulate rankings of the best auto loan providers.
- Industry Standing: Trust and reliability are two of the most important qualities in a lender. Our team considers current industry ratings from organizations such as the Better Business Bureau (BBB) along with factors such as a company’s age.
- Availability: We examine how easy it is for borrowers to get a loan from each provider. Lenders that offer loans to meet a variety of customer needs receive high ratings.
- Loan Details: Our researchers comb through the fine print to learn about the loan amounts, term lengths, and types of loans each provider offers.
- Rates and Discounts: We take an in-depth look at the range of rates each provider offers for borrowers of different credit scores. Our team also factors in the discounts available with each lender.
- Customer Service: Our team considers customer reviews and complaints when determining this score. We also consider the ease and availability of help online, over the phone, or in person.
*Data accurate at time of publication.
