Best Auto Loan Rates in April 2026
See today’s best auto loans — new car rates start at 3.39%
- Auto loan rates vary widely based on your credit score, loan term and the vehicle you choose.
- New car loans generally have lower rates than used car loans because used cars are harder to value, so they are riskier for lenders.
- Getting preapproved before shopping can help you understand your likely rate and avoid dealer markups.
Learn more about how we made our picks for the best auto loans.
Average auto loan APRs by credit score
Your credit score has a huge hand in the average annual percentage rates (APRs) you’ll be offered. To see what a good auto loan rate is right now, here are the average APRs offered on the LendingTree marketplace.
| Credit score range | Average new car APR | Average used car APR |
|---|---|---|
| Excellent (800 and above) | 6.81% | 7.92% |
| Very good (740-799) | 6.83% | 7.59% |
| Good (670-739) | 8.22% | 10.75% |
| Fair (580-669) | 19.15% | 21.13% |
| Poor (Under 580) | 22.11% | 23.82% |
Not sure where you stand? Check your credit score for free with LendingTree Spring. We’ll also give you personalized recommendations on how you can improve your credit score — and qualify for lower rates.
Estimate your monthly car payment
About 5% of Americans with auto loans are delinquent (or late) on at least one auto loan, according to a LendingTree survey.
Calculate your monthly car payment while shopping for your car to avoid a financial hiccup. Having the right tools can make planning feel a little less overwhelming.
How LendingTree works to get you the cheapest auto loan rates
You could save an average of $2,346 on your car loan by using the LendingTree marketplace to shop for loans and then choosing your cheapest offer.
Fill out one form and get lenders from the country’s largest network to compete for your business.
Tell us what you need
Take two minutes to tell us who you are and how much money you need for your vehicle — we’ll take care of the rest. It’s free, simple and secure.
Shop your offers
We’ll send you offers from up to five trusted lenders. Compare your offers side by side to see which one will save you the most money.
Get your money
Finalize your loan with your lender, and you’ll be on the road in no time. — you could see money in your account in as soon as 24 hours.
Understanding auto loans and interest rates
Common auto loan requirements
-
Credit score
It usually takes good credit (670+) for an affordable car loan. It’s possible to qualify with a lower score, but rates will be higher. -
Credit history
Auto loan lenders often like to see at least two years of positive credit history, preferably one that includes a past auto loan. -
Debt-to-income ratio
Debt-to-income (DTI) ratio measures how much you earn compared to your current level of debt, like credit card debt, mortgage/rent and auto loan debt. The best rates usually require a DTI of 35% or less, but some lenders accept 46% to 50%. -
Loan-to-value ratio
Auto loan lenders generally prefer a loan-to-value (LTV) ratio of 80% or less. LTV compares how much you’re borrowing to the actual cash value of the vehicle you’re financing. Higher LTVs generally mean higher auto loan rates. -
Paperwork
If you are financing through the dealer, bring your government-issued ID and an insurance declarations page showing full coverage. Some dealers may require proof of income or residency, so you may want to call ahead to avoid multiple trips.
Car loan terminology
-
APR
An annual percentage rate (APR) measures the total cost of your loan, including interest and fees. The lower your APR, the cheaper your loan. -
Loan amount
Most auto loan amounts start at several thousand dollars. If you want to finance a cheaper used car, make sure the lender’s loan amounts fit your needs. -
Financing term
Your financing term is the length of time you have to pay off your loan. Terms between 12 and 84 months are the most common. Long car loans typically have lower monthly payments, but you will pay more total interest. -
Doc fees
Doc fees are intended to cover the costs the dealership or lender incurs for filing paperwork. While you can sometimes negotiate dealer fees, you’ll often have better luck simply choosing a lender that charges lower fees to reduce your overall costs. -
Dealer reserve
Dealer reserve applies to indirect auto loans. When a dealer shops for financing on your behalf, lenders provide the dealer with a “buy rate.” The dealer can then mark up that rate to earn a profit for the dealership. -
Well-qualified buyers
A well-qualified buyer is someone who qualifies for the best special financing deals on captive auto loans. There is no strict definition of a well-qualified buyer, but it usually requires a 740+ credit score, stable income and a DTI below 35%.
Why car loan rates vary
-
Your credit history and credit score
If your credit score is 669 or below and you have little to no credit history, expect higher rates. -
Used car loans vs. new car loans
Used car loans usually carry higher rates than new car loans. Used car loans are riskier for dealers because used cars are harder to value and don’t depreciate in value as predictably as brand-new cars. -
Long loan terms vs. short loan terms
Longer loan terms typically have lower monthly payments since you have more time to spread your balance across. In return, rates are higher since you have more time to fall behind on car payments. -
Down payment vs. no money down
Making a down payment reduces your LTV, which in turn can bring down your car loan rate. The 20/4/10 car-buying rule says you should make a down payment of at least 20%. -
Lender variability
Every auto loan lender has its own way of calculating rates, not unlike car insurance companies. Shopping around can ensure you get the best rate possible.
Comparing types of auto loans
With so many different types of car loans, it can be hard to know where to start. The table below can help you compare your auto financing options
| Type of auto loan | What it is | What it’s good for | What’s the catch |
|---|---|---|---|
| Captive financing | Financing from the automaker (e.g., Toyota Motor Credit) | 0% APR promos, rebates, and special offers | Top deals require excellent credit; offers apply only to select models |
| Dealership financing | Dealer arranges a loan through its partner lenders | One-stop shopping; access to lenders only available through dealers | APR may be marked up; you can’t verify you’re getting the lowest offer |
| Direct lender auto loans | Loans from a bank, credit union or online lender | Member discounts; straightforward process | Without LendingTree, comparing offers often requires multiple applications |
| Buy here, pay here (BHPH) financing | Loan from the dealership itself, usually for subprime borrowers | Approval when traditional bad credit car loans aren’t available | Rates and fees are very high; may be forced to buy an older car; some BHPH dealerships require GPS monitoring |
How to get the lowest auto loan rates
According to a LendingTree study, improving your credit score from fair (580-669) to very good (740-799) could save you more than $2,316 on your auto loan over time.
Improving your credit score isn’t the only way to get a better car loan rate. You could also:
-
Buy a car that qualifies for special financing
If you’re open to captive financing, then only shop for years, makes and models that have a special financing offer. -
Use a car-buying service
Your current bank or credit union might offer a car-buying service and discount. -
Buy during the holidays
Car manufacturers often run special financing deals at the end of the year and during the holidays, so you could try to time your buy. -
Use a loan comparison service
With LendingTree, you can compare auto loans from up to five lenders, and comparison is key to finding the lowest rates. Plus, nearly 9 of 10 LendingTree users get at least one auto loan offer. -
Get preapproved
Get a preapproved car loan and ask the dealer if they can do better. The dealer might be motivated to get you a cheaper rate in order to sell you a car.
Prequalification is often the first step when shopping for a car loan. It doesn’t hurt your credit and can help you decide which lenders are worth getting preapproved for.
Preapproval is as close to a car loan you can get without actually finalizing your offer. It provides more accurate rates, but requires a hard credit pull. Get your preapprovals done within 14 days to minimize damage to your credit.
Avoid car-buying mistakes with our expert insights
The most common mistake when buying a car is saying yes to a monthly payment. When you’re talking about money, do one thing at a time.
First, get an agreement on the price of the car you want, then the price for your trade-in — if you have one — and, finally, the rate of your car loan.
If you agree to a monthly price first, the dealer will do everything to keep near that payment while increasing their bottom line. They could up your APR, up the length of your loan or try to slip in things like an extended warranty.
According to Kelley Blue Book (KBB), car buyers can expect to pay up to $6,000 more for brand-new vehicles under $40,000. Currently, there is a 25% tariff on cars built outside of the United States, although this varies based on what country the car was built.
Car parts are also subject to tariffs, so even domestic brands are impacted. There are no vehicles that are 100% manufactured and assembled in the United States.
Used cars aren’t directly affected by tariffs since they’ve already been imported. However, used cars may have a higher demand as more people skip new cars (and tariffs). This could cause an increase in used vehicle pricing.
What does that mean for you? It’s more important now than ever to make sure that you’re getting a good deal on your car loan. A lower interest rate can help make up for the added expense that tariffs may add to your bottom line.
How we chose our picks for best auto loans
We reviewed 25 auto lenders to determine the overall best 10 auto loan lenders.
According to our systematic rating and review process, the best car loans come from , , , , , , , , and .
To make our list, lenders must offer auto loans with competitive APRs. From there, we prioritized the following factors:
Accessibility: We chose lenders with auto loans that are available to more people and require fewer conditions. This may include lower credit requirements, wider geographic availability, faster funding and easier and more transparent prequalification, preapproval and application processes.
Rates and terms: We prioritize lenders with more competitive starting fixed rates, fewer fees and greater loan options for repayment terms, amounts and APR discounts.
Repayment experience: For starters, we consider each lender’s reputation and business practices. We also favor lenders that have self-service payment options (like a mobile app), provide reliable customer service and offer unique perks.
LendingTree reviews and fact-checks our top lender picks on a monthly basis.
LendingTree partners with dozens of lenders, but partners and non-partners receive equal treatment in our scoring and review process. Read more about our editorial guidelines.
Frequently asked questions
Generally, the best place to finance a car is with the lender that offers you the lowest rates. The only way to truly know if a lender is giving you the most competitive rate is to shop around.
- : Rate discounts for using a car-buying service
- : Best for cheap auto loan rates on short-term loans
- : Best for bad credit auto loans
- : Best used car loans overall
- : Best for private-party auto loans
- : Best car loan overall
- : Best for bad credit used car loans
- : Best for borrowers who want a full-service bank experience
- : Best for a quick and easy car loan experience
- : Best for dealerships in the Chase network
If you don’t mind using a TrueCar car-buying service, PenFed is currently offering the lowest auto loan rates of all the lenders we’ve reviewed ( for new cars, and for used cars).
If you don’t want to use a car-buying service,
But remember that only the most qualified buyers get the lowest APRs, so your rate may be higher.
You should aim to pick a car loan term of four years or less. Shorter loan terms typically carry the lowest rates, and you’ll pay less overall interest.
A shorter loan term also helps to protect yourself against an upside-down car loan. The longer it takes you to pay off your car, the more time your car has to depreciate.
Use our auto loan calculator to see how different term lengths can impact your monthly payment.
According to LendingTree’s most recent data, the average auto interest rate for a 700 credit score is 9.13% if you’re buying a new car. If you’re buying used, 11.75% is the average.
Even so, lenders don’t just look at your credit score when determining your auto loan rate. They typically include your income, repayment term, credit history and additional factors. Your quoted rate could be higher or lower, depending on your unique situation.
Many people choose a longer loan term because they typically come with a lower monthly payment. That’s because you have more time to spread your balance across.
However, the longer your loan term, the more overall interest you’ll pay. Loans with longer repayment terms also generally have higher rates than shorter ones.
Auto loan rates are usually negotiable, but it depends on where you’re buying your car. Some dealerships, including , don’t negotiate. But most dealerships are willing to haggle. Consider getting a preapproved car loan and asking the dealer to beat its rate.