Average car loan interest rates by credit score Advertiser Disclosure Advertiser Disclosure We are an independent, advertising-supported comparison service. Our goal is to help you make better financial choices by providing you with interactive financial calculators and tools as well as publishing original and objective content, by enabling you to conduct research and compare information at no cost and help you make informed financial decisions. Bankrate has partnerships with issuers such as, but not restricted to, American Express, Bank of America, Capital One, Chase, Citi and Discover. How We Earn Money The offers that appear on this site come from companies that pay us. This compensation may impact how and where products appear on the site, such as such things as the order in which they may appear within the listing categories, except where prohibited by law. This applies to our mortgage, home equity and other products for home loans. However, this compensation will have no impact on the information we provide, or the reviews you read on this site. We do not include the vast array of companies or financial offers that may be available to you. skynesher/Getty Images

3 min read The publication was published on December 02, 2022.

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Written by Bankrate The article was created with the help of automation technology, and then verified and edited by an editor from our editorial staff. Written by Rhys Subitch Edited by Auto loans editor Rhys has been writing and editing for Bankrate since late 2021. They are committed to helping readers feel confident to control their finances. They provide clear, well-researched information that breaks down otherwise complicated subjects into bite-sized pieces. Written by Mark Kantrowitz Reviewed by Nationally recognized student financial aid expert Mark Kantrowitz is an expert on student financial aid as well as the FAFSA as well as scholarships, 529 plans, tax benefits for education and student loans. The Bankrate promises

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They ensure that what we write will ensure that our content is reliable, honest and reliable. We have loans reporter and editor focus on the things that consumers are interested about most — various types of loans available and the most competitive rates, the best lenders, how to pay off debt and much more. So you’re able to be confident about investing your money. Integrity of the editing

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You have money questions. Bankrate has answers. Our experts have been helping you master your finances for more than four years. We continually strive to provide consumers with the expert guidance and the tools necessary to succeed throughout life’s financial journey. Bankrate adheres to strict standards , so you can trust that our information is trustworthy and precise. Our award-winning editors and journalists provide honest and trustworthy information to assist you in making the right financial choices. Our content produced by our editorial team is objective, factual, and not influenced through our sponsors. We’re open about the ways we’re able to bring quality content, competitive rates, and useful tools to our customers by explaining how we earn money. Bankrate.com is an independent, advertising-supported publisher and comparison service. We are compensated in exchange for the promotion of sponsored goods and services, or by you clicking on certain hyperlinks on our site. Therefore, this compensation may affect the way, location and in what order products are listed in the event that they are not permitted by law. This is the case for our mortgage home equity, mortgage and other home lending products. Other factors, like our own proprietary website rules and whether the product is available in your area or at your personal credit score may also influence the manner in which products are featured on this site. While we strive to provide the most diverse selection of products, Bankrate does not include details about each credit or financial product or service. Car loan interest rates are dependent on the score you have on your credit. The lower your score lower, the greater the interest rate you will pay. However, you don’t need a perfect score to get a good rate. To find the best rate, you should shop around and work to improve your credit score if it’s in poor condition. Average auto loan interest rates based on credit score loan interest rates are tied in direct relation to the credit scores of your. With that said it’s possible to still secure an acceptable rate even without high-end credit. To get a better idea of just how much of a difference it could make, and to get an idea of where your interest rate might be, take a look at the rates that are averaged by credit score. Credit score

Average interest rates for brand new car loans

The average interest rate of used automobile loans

781 to 850



661 to 780



601 to 601 to



From 501 to 600





19.81% The source: factors that influence the auto loan interest rates While your credit score will play a large part in determining the amount of interest you will pay, there are other factors to be considered in conjunction with it. Credit score Two of the most popular scores used to evaluate auto loans are FICO as well as VantageScore. Both are used to determine various aspects of financial well-being, such as the history of payments, credit utilization, credit mix and average time to maturity of accounts. There are some differences in the amount of metrics used and how they’re weighted. However, both scores are between 300 and 850. The lenders you choose to use different credit underwriting criteria. In addition to your credit score, your income and debt-to income ratio are going to be considered. Some lenders might consider your educational or professional background or weigh it more heavily than others. Beyond the qualification and underwriting standards, some lenders also provide lower rates as compared to other lenders. Just know that the lowest APRs — those typically displayed in lender website — are available to those with good credit. Amount borrowed Both the price of the vehicle and the amount of your down payment will be a factor in the amount you borrow. If you’re not willing to put more than the amount required down, the lender might view it as increased risk and up the rate of interest to make up for the risk. Length of the loan The longer the loan term, the more the interest you’ll have to pay. However, in addition to the added interest and the higher interest rates charged by lenders, lenders can also offer higher rates of interest on longer loans. How to get a better car loan rates There’s a number of ways to improve your chances of getting a competitive interest rate, no matter what your credit rating. Shop around Shop around with several lenders, including banks, and then compare auto loan interest rates. Some lenders don’t have a credit report So if you’re looking to build your credit make sure to pick one that does. Request preapproval an excellent idea to talk to at three lenders before you settle on one. It is required to supply some personal and employment details, however not every rate quote will require a credit test. Because some do require a credit check however, you should limit your application window to about two weeks. Consider a larger down payment A down payment reduces the amount you have to be able to borrow. Through reducing the amount of money borrowed, the lender takes on lower risk. The lower risk means reduced interest. Consider a co-signer in the event that you have an unsatisfactory credit score Consider soliciting a family member or trusted acquaintance with an outstanding credit score to . Your co-signer will assume the debt if you can’t pay it back, which means that there’s less risk to the lender. Remember that this could cause stress on the relationship if you are unable to pay. Where to find the best automobile loans There are many different ways to locate the most suitable auto loan. Banks. If you already have a relationship with a bank and an impressive credit score, the bank could offer one of the most competitive interest rates. However, you must read the whole agreement before you sign — some banks write in an agreement that permits them to access your savings or checking account. Credit unions. Like a bank, if you’re a member or a member of a credit union they may have a competitive interest rate. Even if you’re not the best credit, a credit union might be willing to look past the issue and offer a reasonable rate. Online lenders. There are many online lenders offering auto loans that you are able to prequalify for. Similar to most direct lenders, you’ll likely be offered a better deal than you would by applying to an auto dealer. Car dealers. This is one of the most effective ways you could get . Dealers can add markups on interest rates provided that means you’ll be charged more than you had a loan . Make sure to speak with several lenders prior to visiting a dealership to get the best price possible. The bottom line: Low automobile loan rates are usually only available to those with near-perfect credit scores. And while it’s good background to know the average rates, you’re not guaranteed to get the figure corresponding to the credit bracket you’re in. No matter if you know your credit score or not, you’ll be able to make an online application to lenders and off to determine what kind of rates you’re eligible for. Find out more


Written by This article was created using automated technology that was then thoroughly edited and checked by an editor from our editorial team. Editor: Rhys Subitch Edited by Auto loans editor Rhys has been editing and writing for Bankrate since late 2021. They are passionate about helping readers gain confidence to take control of their finances with precise, well-studied facts that break down complex topics into manageable bites.

Auto loans editor

Reviewed by Mark K. Kantrowitz Reviewed by Nationally known expert on student financial aid Mark Kantrowitz is an expert on financial aid for students, the FAFSA as well as scholarships, 529 plans, education tax benefits as well as student loans.

Nationally acknowledged expert in student financial aid

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